3 Types of Cryptocurrencies That Are Outperforming Bitcoin (And Might Be Poised for a Breakout in 2025)

Up 45% for the year, Bitcoin (CRYPTO: BTC) continues to outperform almost every other top cryptocurrency. That includes peers like Ethereum (CRYPTO: ETH), which has struggled to a 5% gain for the year.

Bitcoin (CRYPTO: BTC) is having a good year, outperforming most other top cryptocurrencies. For example, Bitcoin is up 45% year to date, while Ethereum (CRYPTO: ETH) has only gained 5%.

But there are three broad categories of cryptocurrencies that are outperforming Bitcoin in 2024. In fact, some of these cryptocurrencies are up 100% or more for the year and appear to be poised for a major breakout in 2025. Let's take a closer look.

Meme coins

Remember when Dogecoin was the only meme coin in town? Well, now there are literally thousands of different meme coins, and some of them are posting unbelievable, off-the-charts performance in 2024. For example, there's a new cat-themed meme coin with a billion-dollar market cap that's up nearly 15,000% this year.

If we narrow our search down to meme coins with a greater than $2 billion market cap, however, there are only three candidates to consider: Dogwifhat, up 1,495%; Pepe, up 621%; and Shiba Inu (SHIB 4.70%), up 65%. Long-time crypto investors will likely recognize the name Shiba Inu, given that it was one of the meme coins that soared in value during the previous crypto bull market rally.

The problem with all these meme coins, however, is that they are boom-and-bust cryptos that are just as likely to soar 100% for the year as they are to go to zero. In other words, you're playing with fire here. It's possible to see the appeal of these meme coins as a very speculative short-term play. But, over the long haul, they have no role to play in your overall portfolio.

AI crypto tokens

AI crypto tokens are also outperforming Bitcoin. Loosely defined, these are cryptocurrencies that are highly leveraged to the current artificial intelligence investment boom. In most cases, these digital currencies are used to transact for AI-related goods and services within specific blockchain networks. So, for example, instead of paying for a large language model (LLM) with dollars, you'd pay for it with an AI crypto token.

Within this category, two top names are Bittensor (TAO 8.67%) and Artificial Superintelligence Alliance (FET 5.84%). Both boast valuations above $3 billion, and both rank among the top 30 cryptocurrencies by market cap.

The newest crypto market darling is Bittensor, which has rallied more than 160% over the past 30 days. Bittensor is a decentralized blockchain network designed to foster the development, training, sharing, and trading of artificial intelligence and machine learning models. The vision behind it is the creation of a decentralized, blockchain-based AI organization that can compete with the behemoths of Silicon Valley. Some investors believe that it has the potential to increase in value 10-fold, especially as more money pours into the AI sector.

Ethereum challengers

In 2023, the primary Ethereum challenger was Solana (CRYPTO: SOL), which was up more than 900% for the year. In 2024, however, the new Ethereum challenger making waves is Sui (SUI 6.09%), which is up 137% for the year.

There are several factors responsible for Sui's meteoric rise. These include the recent announcement that Circle's USDC stablecoin would be coming to the Sui blockchain network. This