Foreign media commentators believe that every round of growth in the crypto market will create new hot sectors, but what really drives the short-term surge of some altcoins is often not a sudden improvement in fundamentals, but the result of the combined effects of narrative, sentiment, and holding structure.
Between 2024 and 2025, Layer 1 tokens attracted significant attention, with RWA and crypto AI tokens also performing well. By the end of 2025, the privacy narrative intensified, and ZCash became one of the most obvious beneficiaries. The article mentions that ZEC rose from $34.85 to $750 in the three months from August to November 2025, a cumulative increase of over 2000%.
ZCash's rise largely reflects a shift in sentiment.
The article argues that ZCash's recent surge coincided with rising interest in the privacy sector, but the project itself hasn't undergone any fundamental changes to explain such a significant price increase. In other words, the rapid price jump reflects the market's pursuit of new narratives at the tail end of a bull market.
Based on this, the author believes that a similar psychology can be seen behind every altcoin rally: funds will concentrate on chasing a few tokens that have been given a new story, until the valuation becomes out of touch with reality, and then the volatility will increase rapidly.
RaveDAO experienced a sharp drop in a single day after a three-week surge.
The article also cites RaveDAO as another example. The token rose from $0.237 to $28.57 in April, an increase of nearly 12,000%, but then fell back by about 90% from its high around April 18.
Regarding this surge, on-chain investigator ZachXBT questioned whether insiders controlled over 90% of the supply and influenced prices through centralized exchanges. The article stated that RAVE's total supply is 1 billion, of which only 25.2% is in circulation, with the top ten holders controlling 93.16% of the total supply.
The author points out that even if such tokens are marketed with community governance or cultural concepts, if the circulating supply is low and the holdings are excessively concentrated, the price is more likely to be amplified in a short period of time and more likely to fall rapidly when sentiment reverses.
Memecore was also criticized for its overly concentrated holdings.
In addition to RAVE, ZachXBT also mentioned Memecore. The article describes Memecore as an EVM-compatible Layer 1 blockchain that attempts to build an application ecosystem around community, creators, dApps, and meme culture.
However, the controversy also centers on the token distribution. The article cites Bubblemaps data stating that a single Binance deposit address holds approximately 41.5% of the supply. ZachXBT previously questioned the flow of funds after the token's listing on Kraken, claiming that approximately $7.9 million in suspicious withdrawals went to 18 newly created addresses, which collectively hold 11.7 million M tokens, currently valued at approximately $33.8 million according to the article's estimates.
The article also mentioned that ZachXBT has not yet produced conclusive evidence that insiders hold more than 90% of the supply, but stated that it will continue its investigation.
Narrative can drive up prices, but it can't replace structural quality.
The article concludes that the number of altcoins today far exceeds that of the earlier periods, and funds are more widely dispersed, making it difficult for the market to replicate the early days when "buying any project could result in a short-term return of dozens of times." Those projects that can truly weather the downturn are those with practical uses, a relatively stable token release schedule, and a market capable of absorbing the unlocking pressure.
The author notes that trading volume data is not always reliable, as wash trading can still occur. In contrast, circulating supply, unlocking schedules, holdings by the top addresses, and on-chain fund flows remain more important indicators to consider when identifying abnormal price movements.
