Diamond Hands Finale: Four Altcoin Investment Opportunities I'm Watching
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Diamond Hands Finale: Four Altcoin Investment Opportunities I'm Watching
See if this version đđ can outperform BTC đ in the next two years.
Navigating Web3 tides with focused insightsAuthor: Lao Bai
It's been two years since I last wrote a Diamond Hands series. Today, here comes the third editionâand likely the final oneâbecause this market cycle has rewarded only BTC diamond hands, while mercilessly washing out nearly all others. Previous Diamond Hands articles leaned toward finding alpha; this one leans more toward beta, especially since some earlier alpha picks ended up getting rekt beyond recognitionâtruly a painful memory best left behind.
The biggest beta remains the dominant one plus three strong contenders: BTC + ETH, SOL, BNB. As for altcoin betas, I personally favor the following four right now and plan to hold them for a while longer.
1. AAVE - AAVE is one of the very few assets outside the "one dominant, three strong" group that you can actually hold long-term and still sleep soundly at night. Its TVL has already surpassed previous highs, exceeding $30 billion. Even more impressively, after all these years, it has never suffered a major security incident. You see traditional financial institutions like JP Morgan dipping their toes into blockchainâthey prefer testing on AAVE first.
This current wave combining RWA+ stablecoins represents the convergence of blockchain and traditional finance, boosting efficiency in a fast, cost-effective way. This is undoubtedly the most important direction for blockchainâs future development. Among projects positioned to ride this waveâaside from layer-1 chainsâthe outcomes for Uniswap/Curve are less certain, whereas AAVE is definitely, unquestionably, and firmly one of the leading beneficiaries. The upcoming launch of V4 in the coming months is also highly anticipated, making it well worth holding.
2. Pendle - TVL already at $6 billion, nearing its previous high, extremely stable, and poised to enter its third wave
Pendleâs first wave relied on Sushiswap and other DeFi protocols, splitting yield from liquidity mining. But it generated little buzz or momentum because those yields were largely illusory.
The second wave came with Lido and Eigenlayerâs LST/LRT, which skyrocketed. This time, the yields were much more tangible.
The next, third wave will be driven by RWA and stablecoins. In traditional finance, yield tranching and risk segmentation form an extremely critical sector with massive market potential (on the order of tens of trillions). As more RWA and stablecoin assets appear on-chain, this sector is bound to grow alongside them. Unlike AAVE, which still faces competition from Compound and Morpho, Pendle dominates this space almost entirely aloneâso far ahead that no real competitor is even visible through a telescope.
The only downside? The token price is too stableâminimal volatility. Iâll hold it for several months and see how it goes.
3. Hyperliquid - The strongest launched project of this cycle, without exception
Its overwhelming user experience and trading depth across chains have led to equally dominant trading volume and market cap leadership.
Moreover, Hyperliquid isnât just another perpetuals platformâitâs positioning itself as the liquidity layer on-chain. Phantomâs recent integration is solid proof of this. More front-ends will connect to Hyperliquid as a backend liquidity provider in the future.
Beyond its ongoing aggressive buyback program, Hyperliquid is preparing additional moves such as building the HyperEVM ecosystem and launching HIP-3 for RWA-based perps.
However, Hyperliquid is the only diamond hand I havenât yet entered, simply because I sold my airdropped tokens between 4â10 and now feel regret seeing its near $50 billion market cap. Itâs hard to pull the trigger again. But I will eventually find a good entry point. If not now, then surely during the next bear marketâŠ
4. Bittensor - I used to be skeptical about Bittensor, but only recently did I change my mind and become bullish. I plan to hold it for 6â12 months.
My skepticism stemmed from its product-market fit (PMF). I started questioning it back in 2023 and still harbor doubtsâBittensor always reminded me of Filecoin.
Filecoin fills storage with junk data due to lack of real demand; Bittensor creates artificial demand and miners compete over inference results that seem utterly useless. Last year, there were many scandals involving miners colluding with validators, spreading rumors, emissions drama, etcâŠ
So overall, it just felt like Filecoin all over again.
So why did I recently change my mind?
First, this market cycle has falsified many crypto narratives while confirming two clear ones.
The confirmed sectors are finance (DeFi, RWA, stablecoins) and gambling (memes, Polymarket, various on-chain casinos).
One of the few remaining unproven but still plausible narratives is Crypto+AIâand among these, Crypto+AI stands out as potentially the largest. Even if it can't be fully validated in the short-to-medium term, it's also extremely difficult to completely disprove.
Among all current AI+Crypto projects, Bittensor is the hardest to dismiss.
Hereâs why:
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It has the highest market cap in this sector and leads in mindshare. When people think of Crypto+AI, Bittensor is usually the first name that comes to mind.
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Few people today can clearly explain what Bittensor actually does. Try explaining it to a friend in ten minutesâcan you actually make it understandable?
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Subnets are already approaching 100 in number, with 200â300 expected next year. Some subnets are already showing signs of PMF+ and generating revenueâeven if most clients are still Web3 projects and the income is negligible relative to Bittensorâs market capâŠ
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Bittensorâs halving is scheduled for JanuaryâFebruary next year. Like BTC, it has a hard cap of 21 million and halves roughly every four years. Next yearâs halving will undoubtedly be a major event.
In terms of emission mechanics and mindshare, Bittensor functions as the BTC of the AIxCrypto space. Meanwhile, its subnet design, consensus, and proof mechanisms resemble ETHâthereâs a chance a breakout subnet could emerge with real PMF, just as Uniswap and AAVE emerged on Ethereum. After all, its subnets span decentralized training, data, compute, inference, text, image, video, drug research, and so onâvirtually every conceivable AI+Crypto niche already has one or more subnets actively working on it. Compared to other projects, Bittensor increasingly feels like a foundational platform akin to ETH, especially now that subnets can issue their own tokens.
But Bittensorâs biggest challenge remains its high valuation. Daily emissions exceed one million USD alone, making it difficult to absorb at this stage. If it feels expensive now, pay close attention around the first half of next year. Whether to hold now is optional.
Alright, this concludes the Diamond Hands series once and for all. In the next couple of years, letâs look back and see whether this final edition of diamond hands can outperform BTC. So letâs record todayâs prices: BTC-118275, AAVE - 312.7, Pendle - 4.43, Hyper - 44, TAO- 433.
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Lao Bai
