Crypto Purge: Millions of Junk Coins Must Die for Bitcoin’s Bull Run

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Purge of millions of crypto tokens underway, <a href="https://jpygbp.com/btc-usd/">BTC</a> needs it for sustainable bull cycle: Ben CowenMarkets

What to know:

  • Analysts say a lasting bitcoin bull market requires a painful purge of thousands of speculative “junk coins,” a process already well underway since 2021.
  • Bitcoin’s dominance has climbed back above 60% as capital exits failed altcoins and memecoins, with some research suggesting it could approach 70% by 2030.
  • Despite bitcoin’s recent move above $81,000, several veteran traders and analysts expect further downside and do not foresee a new all-time high in 2026.

As a crypto investor, I’ve been hearing for years that a lot of these smaller coins aren’t going to make it. It’s not a new idea at all. People like Charles Hoskinson from Cardano and Vitalik Buterin, one of the founders of Ethereum, predicted a long time ago that most of the coins created during the ICO boom would fail – they estimated over 90%. Even Brad Garlinghouse, the CEO of Ripple, said back in 2019 that he thought 99% of all cryptocurrencies would eventually disappear. It feels like we’re heading towards a big shakeout where a lot of these projects just won’t survive.

During my research, I noted that sentiment hasn’t shifted much. At Consensus Miami 2026, Arthur Hayes made a strong point: he believes most altcoins will likely fail, ultimately going to zero. He argued that the primary factor determining which few survive will be access to real-world money – fiat liquidity – and not necessarily the projects themselves.

According to market analyst Ben Cowen, founder of Into the Cryptoverse, the crypto market has been gradually correcting itself since 2021. However, he believes a more significant removal of weaker cryptocurrencies is needed before Bitcoin can begin a lasting and reliable upward trend.

Bitcoin recently surpassed $81,000, a price it hasn’t seen since late January, leading some to think the prolonged downturn in crypto is ending, as Michael Saylor has stated. However, more and more analysts caution that this price increase might be temporary – a short-term boost caused by a lack of strong selling pressure rather than genuine excitement. They highlight significant amounts of existing Bitcoin purchases below the $60,000 mark and a key resistance level around the 200-day moving average as potential obstacles to further gains.

The junk coin purge must occur

Bitcoin is currently testing its 200-day moving average, which is around $82,300. In the past, when Bitcoin hasn’t been able to break through this level, the price has often fallen sharply as investors become less optimistic. According to Cohen, if Bitcoin doesn’t establish $88,880 as a solid support level soon, it’s likely to fall back to between $58,000 and $62,000.

According to CryptoQuant analysts in a post on X (formerly Twitter) on Thursday, the price needs to decisively break above 88,880 and stay there to confirm a market bottom. Simply touching that level briefly or failing to hold it after a brief rise wouldn’t be enough. Breaking and holding this level would put recent buyers back into profitable territory and alleviate some of the initial selling pressure.

In my view, the cryptocurrency market needs a significant correction before it can experience a lasting, positive surge. We’re likely to see a lot of the more speculative and less viable coins – what some call ‘junk coins’ – fail, but I believe this is a necessary step for the overall health and long-term growth of the market.

We’re seeing a change in the crypto market where money is flowing into Bitcoin while less promising projects are failing. Although over 25 million different tokens have been created, many aren’t surviving – in fact, more than 11.6 million failed in 2025. This is mainly because of the large number of memecoins, many of which have collapsed.

Cowen noted that the growing dominance of Bitcoin is a strong sign of this trend.

Bitcoin used to control almost the entire cryptocurrency market, with over 99% dominance in 2013. As other cryptocurrencies, known as altcoins, became more popular, Bitcoin’s share dropped to around 33% by 2018. However, it has been increasing again, reaching 60% in late April. Experts at Ark Invest predict it could climb to 70% by 2030.

According to analyst Benjamin Cowen, looking at Bitcoin’s dominance while including stablecoins gives a skewed picture. His firm’s analysis shows that without stablecoins, Bitcoin’s dominance is actually over 67%, indicating that money is flowing away from less reliable cryptocurrencies. Cowen explained in his April 2026 Crypto Risk Memo that investors aren’t moving into riskier assets; instead, they’re either buying Bitcoin or holding back from investing altogether.

The data of decay

According to Cowen’s analysis, the cryptocurrency market has been steadily declining in participation since 2021. This downturn is characterized by Bitcoin gaining a larger share of the market, while fewer of the top 100 cryptocurrencies are showing positive price movement.

According to Matthew Pinnock, the Chief Operating Officer at Altura DeFi, the rapid increase in popularity of platforms like Pump.fun has resulted in a flood of unreliable tokens. This has led to a high failure rate – around 86% – for new tokens launched in 2025.

According to Luke Nolan, a researcher at CoinShares, the recent decline in less valuable cryptocurrencies has mostly played out. He notes that the total value of ‘memecoins’ has fallen dramatically, from around $150 billion in December 2024 to less than $50 billion. Nolan believes it’s reasonable that the vast majority – 95% – of these tokens have little to no value.

A gloomy short-term bitcoin outlook

Even though Bitcoin has reached $81,000, analyst Cowen is still wary. He believes Bitcoin is currently in a downward trend and expects it to continue falling throughout the year, citing global uncertainties and the Federal Reserve’s reluctance to lower interest rates. He doesn’t anticipate Bitcoin reaching a new all-time high in 2026, viewing this year as a period of correction and a natural decline in price.

Experienced trader Peter Brandt predicts Bitcoin could reach $250,000 by 2029, but anticipates a lengthy period of price decline lasting potentially until September or October before it does. Michael Terpin, a well-known figure in the crypto world, believes Bitcoin must first drop to around $57,000 over the next few months before it can begin to rise significantly, and doesn’t expect a new record high this year.

According to Cowen, this current economic cycle presents a challenge for riskier investments like Bitcoin and Ethereum. For these cryptocurrencies to thrive, a significant economic crisis would likely need to occur, prompting central banks to adopt more lenient monetary policies. However, until such a crisis emerges, he expects crypto to underperform compared to other investments.

Bitcoin’s price has fallen from around $126,000 to about $60,000, a drop of more than 50%. This pattern is similar to what’s been seen in previous late stages of Bitcoin price cycles, according to Cowen.

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2026-05-07 14:46