Institutional Investors Shift Altcoin Evaluation Criteria

Institutional investors are now focusing on the 'actual usability and profitability' of altcoins instead of their 'market value.' The 'S&P Pantera Digital Asset Index,' created by S&P Global and Pantera Capital, reflects this trend and suggests a potential shift in how the cryptocurrency market is evaluated. This index does not simply group assets by market capitalization but instead focuses on protocols that are actually used and for which costs are paid. The initial candidates for inclusion are 18 altcoins, with six assets, including Ethereum (ETH), Solana (SOL), and Tron (TRX), being prioritized. The selection process begins with approximately 4,500 cryptocurrencies, reviewing those with a market capitalization of over $500 million and consistent revenue over the last two quarters. The inclusion will be determined from the top 30 revenue-generating projects, with 'profit generation' being a key criterion. However, in addition to revenue, factors such as active user count, trading volume, processing speed, and actual use cases are also likely to be evaluated. This change is also related to the regulatory environment in the U.S., where the passage of the Clarity Act is expected to facilitate the influx of institutional funds. Solana serves as a case that institutions may prefer, demonstrating daily active users, revenue, and high processing performance. The altcoin market is likely to become more distinctly divided between 'projects with actual economic activity' and 'speculative tokens.'

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