Cryptocurrencies, artistic representation, Photo: © Volodymyr Shtun | Dreamstime.com
The mass sell-off in the cryptocurrency market shows no signs of stopping, with the smallest and riskiest digital tokens bearing the brunt of the impact, Bloomberg reports.
The MarketVector Digital Assets 100 Small-Cap index, which tracks the 50 smallest digital assets in a basket of 100, fell to its lowest level since 2020 on Sunday.
The low came as Bitcoin, the most popular and valuable cryptocurrency, gave up what had until recently been a 30% year-to-date gain, just weeks after setting an all-time high.
Considered a barometer for the riskiest speculative appetites, so-called “altcoins,” small, high-risk cryptocurrencies, lag far behind larger coins in 2025.
'Game over' for small cryptocurrencies?
The situation drew attention as in previous bull cycles, the “Small-Cap” index often outperformed its counterpart focused on large cryptocurrencies, an effect of traders' appetite for high-risk, high-reward bets.
But that trend reversed last year after the US approved exchange-traded products on Bitcoin and Ether, which became a hot spot for institutional capital flows.
Compared to the last five years, the Small-Cap index is down almost 8%, while the large-cap index is up about 380%, highlighting how much this segment of cryptocurrencies has fallen out of favor.
Pratik Kala, portfolio manager at Australian fund Apollo Crypto, says individual investors have learned lessons from previous cycles. “A rising tide doesn't lift all boats — only the quality ones,” he told Bloomberg.
The crypto market as a whole is still reeling from the October 10 crash, which triggered roughly $19 billion in liquidations and wiped over $1 trillion from the market value of all tokens. Since then, risk appetite has collapsed and traders continue to avoid the most speculative corners of the market.
PHOTO article: Volodymyr Shtun / Dreamstime.com.
