L1 Token in the Cryptocurrency Market: From 2024 Euphoria to Current Dynamics

Throughout 2024, the cryptocurrency sector experienced a significant growth phase, with particular focus on Layer 1 solutions as platforms for decentralized applications (dApps) and smart contracts. Demand for L1 projects increased substantially, but the market subsequently underwent a major correction. Analyzing the evolution of these tokens reveals interesting patterns that reflect the cyclical nature of the crypto market and the importance of strong fundamentals in projects.

The Landscape of Major L1 Tokens: A 2024 Retrospective

During 2024, Layer 1 tokens showed highly variable performance, reflecting the challenges of maintaining momentum in an increasingly competitive ecosystem. Mantra (OM), which had experienced explosive growth in 2024 thanks to its partnership with Zand, a digital bank in the United Arab Emirates specializing in real-world asset (RWA) tokenization, was then the most successful L1 project. The platform benefited from the growing adoption of RWA solutions, with traditional financial institutions bringing money market funds and bonds onto the blockchain.

Similarly, AIOZ Network (AIOZ) captured market attention through its decentralized content distribution network and ongoing ecosystem improvements. Sui (SUI), on its part, stood out for rapid ecosystem development, launching innovative dApps that leveraged high scalability and developer-friendly features.

In the mid- to low-cap Layer 1 token category, Bellscoin (BELLS), Zano (ZANO), and Toncoin (TON) also stood out. The latter benefited significantly from its integration with Telegram, successfully hosting dApps and launching “click-to-earn” games that went viral on the messaging platform.

Megacap L1 Tokens: Bitcoin, Ethereum, and Solana in the Market Cycle

Among large-cap L1 projects, behavior was more conservative. Bitcoin (BTC) maintained its position as a benchmark, while Ethereum (ETH), despite growth in 2024, did not perform at the level of other L1 tokens. The emergence of new Layer 2 solutions and alternative blockchains gradually eroded Ethereum’s market share, also reflected in its relative underperformance compared to the S&P 500 index.

Solana (SOL) represented a fascinating recovery story. After the trauma of FTX’s collapse in 2022, which severely damaged confidence in the ecosystem, the blockchain experienced a significant rebound in 2024, mainly driven by the memecoin wave. This trend also extended to Tron Network (TRX), which showed a similar growth dynamic.

Toncoin (TON) deserves special mention among notable L1 tokens, thanks to its unique ability to deeply integrate with Telegram, the popular global messaging app. The adoption of “click-to-earn” models on Telegram contributed significantly to ecosystem growth.

Emerging L1 Projects: Challenges and Opportunities from 2024 to 2026

New Layer 1 projects launched in 2024 faced an extremely competitive market environment and significant volatility. Aleo, Saga, Omni Network, and Zeta Chain were launched with high valuations but experienced substantial corrections in subsequent months. Router Protocol (ROUTE) and Ice Open Network (ICE) followed similar trajectories, highlighting the difficulty of competing with established projects without a highly differentiated value proposition.

The case of Kaia (KAIA), which entered the market toward the end of October, showed some relative resilience, although it was also subject to broader market dynamics. These data reflect a fundamental principle in the L1 sector: the crucial challenge is not simply launching a blockchain but building a solid ecosystem, driving user adoption, and continuous innovation.

Underperforming Layer 1 Projects: Market Lessons

Alongside successes, some L1 tokens experienced particularly sharp declines. Entangle (NGL), launched in March 2024 with a high valuation, saw its price plummet in the following months, exemplifying a classic case of overvaluation at launch. Kujira (KUJI) and Trias Lab (TRIAS) suffered significant losses, with Kujira’s performance impacted by high-risk liquidity management decisions that proved counterproductive during market fluctuations.

Market Lessons: What Determines the Success of L1 Tokens

Analysis of Layer 1 token performance from 2024 to date reveals key trends. Projects with concrete institutional collaborations—such as Mantra with Zand—and those integrated into mainstream platforms—like TON with Telegram—have maintained more resilient positions over the long term. Conversely, projects launched with excessive valuations, lacking clear utility or a consolidated ecosystem, have faced severe corrections.

The competition between L1 and Layer 2 solutions continues to intensify. True winners will likely be projects that combine effective scalability, practical utility, and regulatory compliance. In particular, projects like Mantra with real-world asset tokenization or Sui with ecosystem expansion must focus on attracting developers and users through real technical advantages rather than mere promises.

CoinGecko’s analysis of the performance of the top 100 cryptocurrencies in the Layer 1 category provides a snapshot of the market from January 1 to November 18, 2024. These data continue to serve as important benchmarks for understanding the evolving dynamics of the L1 sector. The market cycle from 2024 to 2026 demonstrates that, in the long term, the strength of fundamentals outweighs short-term speculative impulses.