Bitcoin’s increasing momentum was a good time to rally the alts. Last week, when altcoin market cap broke up 18%, there was speculation of a potentially stronger rally in the future.
In the middle of this gala time, it was predictable that Alts would see high sentiment scores and attention sums. However, the fact that Stellar (XLM) and Binance Coin (BNB) would lead this race came as a shock to many.
Riding on high social sentimentality
A recent report analyzed the overall sentiment score of some cryptocurrencies. It highlighted that Stellar took the top spot with a sentiment score of 40 and an attention frenzy of 12%. BNB took second place with a sentiment score of 37.
It is noteworthy that the attention surrounding Dogecoin has dropped by 20% in the past week. Chainlink and Ethereum maintained their place in the top 5 with sentiment ratings of 35 and 34 respectively.
At the time of writing, XLM was near a multi-month high of $ 0.419 and BNB was only 42.55% off its ATH. Ergo, are this attention frenzy and the high sentiment score enough to keep these alts afloat?
Undoubtedly, the social sentiment is good for assets, but it cannot overshadow the strength and functionality of the network. And neither BNB nor XLM have hit these numbers in the recent past. In fact, a Nasdaq article pointed out that XLM “has to deliver something other than cheap money transfers if it is to gain mainstream acceptance.”
With investors continuing to place their bets based on breakthrough utility, XLM and BNB missed the same thing, while blockchains like Solana took the opportunity, which in turn revived their price.
This is missing from BNB and XLM
Solana’s dramatic attempt to establish itself as the eighth largest coin by market cap sparked a discussion about the rally of the alts in the near future. While the expectations of other alts have risen, the fact that SOL’s independent rally has been driven by the long-term growth of development activities has been overshadowed.
Although XLM has seen a lot of development activity alongside its price hike, the recent discontinuity in the same trend has been a disturbing trend.
Notably, both BNB and XLM have had high development activity in the past few days. This contributed to their price increase.
However, the downward tick in the same period at the time of going to press meant a reversal in development activities could take place. When it comes to development activities for a sustained rally, steady growth of the same, as in the case of Solana, is ideal for coins. This is missing from both BNB and XLM.
Additionally, despite recent gains, both had a much lower ROI compared to some of the other top alts.
Both Stellar and BNB recorded high prices as well as a decline in their market capitalization. In fact, Stellar’s market cap was as small as it was in 2017. To reverse that, Stellar would need a strong push from the development side.