Turn to crypto-related stocks for gains as the long-awaited altcoin rally shows no sign of hope, according to Wolfe Research. Seasoned crypto investors have become used to a shift in market sentiment that usually follows new bitcoin all-time highs: Capital flows out of the flagship coin and into smaller, higher-risk cryptocurrencies known as altcoins. There have been two runups to new bitcoin records this year, but “alt season,” or altcoin season as the trend has become known, has not followed and isn’t likely to this year, Wolfe found. “It has been our call for months that investors should stick to bitcoin until we see life return to altcoins. That life has yet to come,” Wolfe analyst Read Harvey said in a Wednesday note. “The median coin out of those we track is down 32% YTD. It’s a far cry from what we have seen from equities, which currently trade at new highs.” Ether , dogecoin , Solana’s SOL token and Cardano’s ADA are all down double-digits for the year. Binance Coin is down 6%, while XRP is bucking the trend with an 11% gain. “The lack of participation from cryptos is honestly one of the more confounding developments this year,” Harvey added. “There has been a complete lack of desire to own speculative altcoins even as the market rallied to new highs and rates have come in.” Meanwhile, crypto stocks have outperformed bitcoin since the S & P 500 reached its closing low on April 8 – a trend that has “plenty more room to run” alongside broader market movements, Ginsberg said. The Bitwise Crypto Industry Innovators ETF (BITQ) is up 76% since the market’s April low, while bitcoin has advanced 38% in the same period. Bitcoin mining companies Cipher Mining , Terawulf , Riot Platforms and Mara Holdings have all either broken through their 200-day moving averages or are about to, and they will likely retest their November levels, Harvey said. “While the likes of dogecoin holders may be hurting, there’s no sign of pain for those playing the space through stocks, which we continue to recommend sticking with,” he said. —CNBC’s Michael Bloom contributed reporting.
