Benjamin Cowen: Junk Coin Purge Required for True Crypto Bull Market

VADODARA, January 26, 2026 — The cryptocurrency market cannot achieve a genuine bull run without purging most junk coins, according to Benjamin Cowen, founder of Into The Cryptoverse. This daily crypto analysis examines his structural critique amid extreme fear sentiment and shrinking liquidity. Market structure suggests thousands of cryptocurrencies rely on speculative momentum, lacking real demand or utility.

Investigation: Cowen's Call for Market Normalization

Benjamin Cowen argued that a true bull market requires eliminating junk coins. In comments reported by YouToday, he stated thousands of cryptocurrencies depend solely on speculative momentum. They lack real demand or utility. This structural weakness exposes itself in shrinking liquidity environments. Cowen described the failure of unsound projects during bear markets as essential. It normalizes capital allocation.

He cautioned against influencer optimism predicting altcoin seasons. Such views are dangerous without fundamental market structure improvements. Capital can only concentrate on high-quality assets after removing worthless ones. Cowen believes this process will revitalize the industry. According to on-chain data, liquidity maps show capital fragmentation across low-utility tokens.

Market Context & Historical Precedent

Historically, bear markets purge weak projects. The 2018-2019 cycle saw thousands of ICOs fail. Similarly, the 2022 downturn eliminated many meme coins and low-utility altcoins. In contrast, the current market faces extreme fear with a score of 20/100. Underlying this trend is a liquidity crunch. Federal Reserve policies on interest rates impact capital flows into risk assets.

Consequently, market analysts question if this cycle differs. The proliferation of junk coins may delay a sustainable bull run. , recent developments highlight structural pressures. For example, Bybit delisted several low-liquidity tokens amid extreme fear. This action aligns with Cowen's purge thesis.

Technical Architecture & Price Action

Market structure suggests Bitcoin's price action at $87,710 reflects broader uncertainty. The Fibonacci 0.618 retracement level from the 2025 high sits at $82,000. This level acts as critical support. A break below could trigger further junk coin liquidations. RSI indicators show neutral momentum, but volume profile analysis reveals thinning liquidity in altcoin markets.

Order blocks from previous rallies now act as resistance. Fair value gaps exist between institutional accumulation zones and retail speculation areas. On-chain data indicates UTXO age bands are aging, suggesting HODLer behavior amidst fear. Technical architecture must stabilize before capital reallocates to quality assets.

By The Numbers

Why It Matters

This matters for portfolio durability. A junk coin purge could redirect billions in capital. Institutional liquidity cycles favor assets with clear utility, like Bitcoin or Ethereum. Retail market structure often chases speculative pumps. Consequently, a cleanse may reduce systemic risk. Evidence includes declining trading volumes for low-cap altcoins.

Market analysts note that without this purge, bull runs become short-lived. They rely on hype rather than fundamentals. Historical cycles suggest sustainable growth follows consolidation phases. The current extreme fear sentiment may accelerate this process.

Expert Commentary

"Capital concentration on high-quality assets requires removing worthless ones. This isn't pessimism; it's market hygiene. We see on-chain liquidity fleeing junk coins, confirming structural weakness." — CoinMarketBuzz Intelligence Desk

Market Outlook & Price Scenarios

Two data-backed scenarios emerge from current market structure.

• Bullish Invalidation Level: $98,000. A break above this resistance confirms trend reversal, potentially delaying the purge as speculation returns.
• Bearish Invalidation Level: $82,000. Holding this Fibonacci support maintains structure; a break below accelerates junk coin liquidations.

The 12-month institutional outlook hinges on liquidity normalization. If the purge occurs, capital could flow into assets with real-world use cases, such as stablecoin innovations. Over a 5-year horizon, this may lead to a more resilient market with fewer but stronger projects.