Crypto investor and writer Zeneca says the market is shifting away from the old "spray and pray" approach, where broad exposure to many tokens could still work, and toward a structure in which only a small number of higher-quality assets keep outperforming.
In the piece, written by Zeneca and translated by TechFlow, he argues that the familiar retail strategy of buying a wide basket of coins has broken down. His case rests on cycle data, capital-flow concentration, and the rise of token buybacks and burns.
From the post-FTX low to the 2025 peak, the top 100 basket badly trailed Bitcoin
Zeneca starts with a simple thought experiment. Suppose an investor had $10,000 on Nov. 20, 2022, about a week after the FTX collapse, and split it evenly across the top 100 tokens by market capitalization, putting $100 into each one. Then suppose that basket was held through the full run-up, including the ETF period, the election, and the inauguration rally, until total crypto market capitalization peaked on Oct. 6, 2025.
By his calculation, that portfolio would have grown to about $19,400. That is not a terrible result on its own. But the comparison is the point: the same $10,000 put only into Bitcoin would have been worth about $76,600.
Zeneca says three-quarters of the gains across the top 100 came from just 10 tokens, while the median token in the basket ended up worth $0.99 for every $1 invested. In other words, even if someone bought near the bear-market bottom and held all the way to the top, more than half of the tokens in the portfolio would still have been losers.
His conclusion is blunt. Beating Bitcoin is hard, and the broad-basket strategy that many crypto investors learned early on no longer works the way it once did.
He says crypto is moving closer to a value-investing framework
Zeneca argues that the replacement for indiscriminate token buying is not simply another round of narrative chasing. In his view, the market is moving toward something closer to the style associated with Benjamin Graham and Warren Buffett: own a small number of projects that put real money into their own tokens, buy when they are cheap or when growth is not yet reflected in price, and hold for years.
He adds an important caveat. What happens after a token is repurchased matters. Burned tokens are gone permanently. Tokens distributed as rewards often come straight back to market, which weakens the effect of the buyback.
He also says ZEC is his exception, describing it as a store-of-value token with no buyback program, and openly notes that it does not fit Buffett's preference for cash-generating assets.
Three cycles, three very different markets
To explain why the old approach once worked and why it no longer does, Zeneca compares three market cycles.
In the 2017 cycle, he says the median top-100 token was up about 46x by the January 2018 peak, and most of those tokens outperformed Bitcoin. In that environment, buying a broad set of names from CoinMarketCap could produce outsized returns almost regardless of selection.
By 2021, that pattern was still visible, but much weaker. According to Zeneca, the median token performed roughly in line with Bitcoin.
By the 2024-25 cycle, the picture had changed again. The median top-100 token was up only about 3x even at its best point, and only around one-eighth of the group beat Bitcoin. Most tokens, he says, had already peaked by mid-2024, more than a year before the broader market topped.
That, in his telling, helps explain why many investors felt their altcoin holdings had already rolled over in early 2024 while the wider market narrative still insisted the bull run was intact. He says most altcoins really had peaked, and the long-awaited "altseason" many people sat through may never return in the old form.
Narrative chasing has weakened too
Zeneca says another common crypto playbook, rotating into hot themes early and exiting before the crowd, has also become less reliable. He lists ICOs, DeFi summer, NFTs, alternative layer-1s, memecoins, and AI agents as examples.
His argument is that the winners from one theme often do not survive into the next cycle. He writes that only about one-tenth of the top 100 from 2017 made new highs in the following cycle. He also says the total memecoin market cap is now about one-fifth of its peak in December 2024. As for NFTs, he leaves the point hanging with a brief aside rather than more data.
Still, he says one development stands out: some altcoins appear to be decoupling from Bitcoin, even in a bear market.
Looking back from the 2025 top, the best few names pulled far away from the pack
Zeneca runs another test from the other side of the cycle. If an investor had put $10,000 into the top 100 tokens on Oct. 6, 2025, the market top, and spread it evenly, that portfolio would be worth about $5,700 today, with only 6 of the 100 tokens in positive territory.
A full Bitcoin allocation from the same date would be worth about $6,700.
But if someone had somehow known which tokens would perform best, the outcome would have looked very different. Putting $1,000 into each of the best 10 performers would have produced about $20,800. Putting $2,000 into each of the best 5 performers would have produced about $31,800.
He says he ran the same exercise for the tops of the prior two cycles, on Jan. 7, 2018 and Nov. 8, 2021, and held for one year. The pattern, in his reading, is clear: the best tokens are increasingly separating from BTC rather than moving as one broad altcoin complex.
That leads to the central question of the article: without hindsight, how do investors identify the "best" tokens in advance?
Too many tokens are competing for the same pool of money
Zeneca says the main reason the broad-basket strategy has broken down is simple: token supply has exploded, while buyer growth and capital growth have not kept pace.
At the January 2018 peak, fewer than 1,400 tokens were listed on CoinMarketCap, he writes. By the end of August 2026, Pump.fun alone was launching about 44,000 new tokens per day. The number of tokens has grown by orders of magnitude, but the amount of money available to absorb them has not.
He says most of the serious new capital has gone to the largest names. From the FTX low to the Oct. 2025 peak, Bitcoin absorbed about two-thirds of the market's net new money, while ETH, XRP, BNB, and SOL took about one-quarter. Everything else combined got only about one-tenth.
In his view, that reflects how ETFs, treasury companies, and funds allocate. They do not buy a little of everything. They buy a few assets they can explain to their own investors, then sit on them.
Even that final tenth of market gains was concentrated. Zeneca says 10 tokens captured nearly half of it, mostly familiar names such as DOGE, TRX, ADA, LINK, and XLM, with HYPE and SUI as the only notable newer entrants.
Over the same period, the number of tokens listed on CoinMarketCap rose from about 21,800 to about 36,200, while Pump.fun alone issued millions more. His takeaway is that most new tokens got almost none of the money. If the next cycle looks anything like the last one, holding too many coins may simply guarantee exposure to a large pile of assets that go nowhere.
Buybacks and burns are becoming a bigger part of the market
What is replacing the old lottery-ticket approach, in Zeneca's view, is a growing class of crypto-native projects willing to spend real cash on their own tokens. The clearest version is buybacks and burns. He also notes that some projects, such as Aerodrome, route fees to users who lock tokens.
He says these tokens have existed for years, but there are now many more of them, and the market response has been strong. Investors like protocols with real revenue, and they like them even more when part of that revenue is used to support the token and its holders.
He points to a sharp increase in scale. Token buybacks rose from roughly $190 million in the year through October 2021 to about $1.85 billion in the year through October 2026. Over the same span, the number of projects spending more than $1 million a year on buybacks climbed from 10 to more than 70.
He notes that DefiLlama has expanded protocol coverage over time, so some of the increase may reflect better data collection. Even so, he says the change is large.
The part he finds most striking is the latest bar in the data. Total crypto market capitalization fell by more than one-third over the past year, yet money spent on buybacks and burns still edged higher. In his framing, that is close to the core of value investing: prices can fall sharply while cash continues to come in.
Bringing Graham's ideas into crypto
To explain his method, Zeneca leans on two classic Graham concepts.
The first is Mr. Market, the emotional business partner who offers to buy from you or sell to you every day at a price driven by mood rather than value. Zeneca says crypto may be the most emotional version of Mr. Market anywhere. From October 2025 to June 2026, the market lost more than half its value. In his framework, those are the moments when good businesses can become attractive buys.
The second is margin of safety. To approximate something like a price-to-earnings multiple in crypto, he uses market capitalization divided by the amount a project spends in one year buying back or burning its token.
His example is straightforward: if a token is worth $1 billion and the project spends $50 million a year on buybacks, the multiple is 20x. At the time of writing, he says some of the best-run and largest projects, including HYPE, JUP, PENDLE, and SKY, were trading around 30x on that rough measure.
He then invokes Buffett's refinement of Graham: it is better to buy a wonderful company at a fair price than a fair company at a wonderful price. In crypto terms, his version is to own only a few tokens, but understand each one deeply.
He compared 100 tokens worth more than $300 million against Bitcoin
To test the framework against actual market outcomes, Zeneca compared every token with a market cap above $300 million as of Oct. 11, 2026, a group of 100, against Bitcoin. He looked at one-year performance and also at performance since the FTX low, using the date a newer token first crossed a $100 million market cap when needed.
Over the year through Oct. 11, 2026, Bitcoin was down about one-quarter. Of the 93 tokens that already existed a year earlier, 37 outperformed BTC.
The biggest outperformers were a mixed group. VVV was up about 16x, DRV about 14x. ZEC and XMR benefited from the privacy trade. HYPE more than doubled. QNT, NEAR, JST, and MORPHO also made the list, along with some newer small-cap names.
But the more important split, he argues, is between tokens with real buyback support and everything else. About 60% of buyback-backed tokens beat Bitcoin over one year, versus only about one-quarter of other tokens. Over the longer period, about half of the buyback group beat BTC, compared with roughly one-quarter of the rest.
He gives several examples. PUMP delivered about 2x Bitcoin's one-year performance. SKY, UNI, and RAY each came in at roughly 1.7x to 1.9x Bitcoin.
He is careful not to overstate the point. Buybacks are not a magic answer. CAKE and CRV have been buying back tokens for years, yet since the FTX low they still underperformed Bitcoin by about 85% to 90%. BONK's launchpad spent heavily on buybacks, but the token still lagged.
In his reading, the winners were usually doing more than one thing right at once: still growing, still cheap relative to buyback spending, or both. And some of the biggest winners had no buybacks at all, with ZEC as the clearest example.
Examples of what he calls Mr. Market at his most generous
What impressed Zeneca most was how cheap some tokens became even while the underlying business kept operating.
- At PUMP's low on June 25, 2026, the token's entire market cap was about three times Pump.fun's annualized buyback run rate. It later rose nearly 5x from that level.
- At AERO's low in February 2026, its market cap was less than three times one year's fees flowing to lockers. It later rose more than 3x.
- At HYPE's low in January 2026, the token traded at about 11x annual buybacks. By October 2026, that figure was about 27x, and the token had risen roughly 4x.
- VVV bottomed at about $0.95 on Dec. 1, 2025, when the token's market cap was around $40 million and Venice was reportedly generating about $10 million in annual revenue. It later rose about 26x.
- RAY and UNI both rose more than 3x from their lows, while SKY nearly doubled.
He says those lows did not feel like opportunities at the time. PUMP's best entry came while memecoins were fading, the market was in a bear phase, and the founder was being sued. But that, in his framework, is exactly the point of Mr. Market: the worst mood can produce the cheapest price, even when the business itself keeps going.
The questions he uses to separate a good business from a weak one
Zeneca then lays out the questions he asks when evaluating tokens, roughly in order.
Does it actually make money?
He means money paid by customers, not value inflated by token issuance. As an example, he says Bittensor subnets were generating about $30 million a year from customers as of October 2026, while newly issued TAO was worth more than 10 times that amount. On that basis, he says it does not pass the test.
How much of that money really reaches the token, and stays there?
He distinguishes between fees, revenue, and profit. User fees are not the same as protocol revenue, and revenue is not the same as what remains after team costs, incentives, and token emissions used to retain users.
He says Hyperliquid sends essentially all revenue into buying back HYPE, while Pump.fun uses about half its revenue to buy back and burn PUMP.
He also points to Collector Crypt. Over the year through October 2026, its gacha card packs generated about $94 million in revenue, but only about 1% of that was used to buy back and burn CARDS. Zeneca says he likes CARDS and sees it as a good business and a strong token, but argues that revenue alone is not enough. Investors need to know how much of that revenue becomes profit and how much of that profit is returned to the token ecosystem.
He says the destination of repurchased tokens is often overlooked. Burned tokens disappear forever. Treasury-held tokens may come back later. Tokens distributed as rewards or cashback are often sold immediately, which means buy pressure and sell pressure can largely cancel out.
His examples are BAT and ETHFI. Brave buys back BAT mainly to pay users who watch ads, and those users often sell. Since September 2026, ether.fi has been sending one ETHFI directly to cardholders as cashback for every two ETHFI it buys back, and many of those recipients may also sell.
Even so, he says he still likes BAT and ETHFI. The point is that when a project tells investors how much it spent on buybacks, the next question should be where those tokens went.
Will unlocks overwhelm the buybacks?
If teams and early investors are selling more tokens than the protocol is removing from the market, the buyback matters much less. Zeneca says Pump.fun will unlock nearly $40 million of PUMP per month for the team and early investors until mid-2029, meaning a large share of its buyback program is effectively absorbing insider supply.
That does not automatically make PUMP unattractive, he says, but it has to be part of the analysis.
Will it still be around in 2029?
If he plans to hold something for years, the protocol has to survive bad periods. Zeneca writes that in crypto, the only way to do well over time is to stay alive first. Not every survivor becomes a winner, but a protocol that survives, keeps growing, generates revenue, and uses part of that revenue to support its token has a much better chance than most.
What about growth?
He says value investing is often misunderstood as buying only cheap and boring assets. He quotes Buffett's 1992 line that growth is always a component in the calculation of value. That means he is willing to pay a higher multiple for something growing quickly, as long as the growth is real and not already fully priced in.
His example here is Derive. He says Derive handles most onchain options trading, that open interest in early October 2026 was more than 10x the level a year earlier, and that after a vote in October 2026, half of its fees began buying DRV every week. At around $0.48, he says DRV was valued at more than 100x trailing annual revenue, which looks extreme against the roughly 30x level of some of the best-run tokens.
His way to test whether growth is already in the price is to work backward. For DRV to trade at roughly the same 30x multiple, with half of fees used for buybacks, Derive would need to grow fees to about four to six times recent levels. If that happens within a few years, DRV may still look cheap in hindsight. If it does not, investors would be paying a growth-stock multiple for an asset that has stopped growing.
ZEC is the exception in his framework
Zeneca says ZEC breaks almost every rule in the letter.
Zcash generates less than $1 million a year in fees, he writes, none of which flows into the token, while newly issued ZEC is worth hundreds of millions of dollars a year. By a classic cash-flow lens, it does not fit.
Still, he includes ZEC in his own plan because he sees it as a store-of-value bet. Bitcoin is the obvious store-of-value asset, he says, and a sensible choice for anyone who simply wants to park money for the long term. But if the goal is to outperform Bitcoin, then for the store-of-value sleeve of the portfolio, he chooses ZEC.
His reasoning is that Zcash combines Bitcoin-like monetary rules, including a 21 million cap and four-year halvings, with optional privacy. As more wealth moves onto public blockchains, he believes privacy will become more valuable.
He also states the risk plainly. With no cash flow, the price is entirely a matter of belief. But he says Bitcoin has long rested on belief as well, and that the meme strength around ZEC is enough for him to hold it.
Where the thesis could fail
Zeneca does not present the framework as foolproof. He lists several ways it could go wrong.
One is that the market's voting-machine side could dominate for a long time. If the next cycle looks like the memecoin frenzy of 2021, a small set of buyback-heavy but relatively dull tokens could lag badly while assets with no revenue at all go up 50x.
Another is that paying up for growth can backfire if growth stalls. For that reason, he says he would size those positions smaller than positions in tokens already buying back large amounts of their own supply.
A third risk is that buybacks can stop. If a team or DAO can start a buyback, it can also end one, as he says happened with Aave and Sky. And token holders usually have no legal claim on protocol revenue.
His plan for the next bull market
Putting the framework together, Zeneca says his rough plan for the next bull market is as follows:
- Hold a small number of tokens backed by real businesses, plus a bag of ZEC as a store-of-value position.
- Only buy when he can explain in one sentence how money moves from customers into the token, and can track where repurchased tokens go afterward.
- Check unlock schedules against buyback size before buying anything.
- Compare price with buyback spending.
- Pay a premium for growth only when that growth is visible in fees, and only after understanding what assumptions are already embedded in the price.
- Write down in advance what would make him sell, then keep holding as long as those conditions do not happen.
- Build positions slowly and let Mr. Market's bad days do the work.
- Measure the whole portfolio against simply holding Bitcoin, because that is the benchmark he is trying to beat.
Final view: missing many opportunities is acceptable
Zeneca closes by saying investors cannot catch every opportunity and should not try. There will be many good projects and good tokens he never buys, and some of them will go up 10x while he sits in what he calls boring positions. He says that is fine.
He would rather own a small number of assets he truly understands and believes in, commit real capital, and give them time, than own a little of everything without knowing why. His advice is to find the few positions one can hold through a 60% drawdown because the underlying project is understood, and accept that many other opportunities will be missed.
He says he plans to write more about his actual portfolio, how it is allocated, and which tokens he likes most, with the same focus on business fundamentals.
The article ends with a disclaimer that the newsletter should not be treated as investment advice, that the author is not a financial adviser, and that readers should consult a professional or licensed adviser before trading or investing in crypto-related products. Some links, he adds, may be referral links.
