Altcoins, with market capitalizations under $10 billion, are poised to offer investors new opportunities as they recover from their recent slump. Since Bitcoin hit a record high in March, these smaller cryptocurrencies have taken a significant hit, but they may now be gearing up for a comeback.

"Smaller cryptocurrencies have been absorbing the blows since the March high," Jamie Coutts, chief crypto analyst at RealVision, noted in a recent post. If this is indeed a mid-cycle correction, investors can expect to find opportunities in mid and small-cap cryptocurrencies once the market stabilizes.

The equal weight index, which assigns equal weight to all cryptocurrencies regardless of market capitalization, has fallen by over 30% against the market cap index, which weights cryptocurrencies by their market capitalization. This indicates that smaller cryptocurrencies have performed weaker compared to larger ones.

Meanwhile, Bitcoin and Ether, the two largest cryptocurrencies, have experienced relatively smaller declines of 11% and 5%, respectively, over the past three months. Metaverse-related tokens, however, have recorded the lowest returns, with a negative 44.13% return.

In the under $1 billion market cap category, metaverse tokens like The Sandbox and Decentraland have both declined by over 15% in the past week. This comes as institutional interest beyond Bitcoin and Ether continues to grow, with asset managers like Franklin Templeton exploring new crypto funds for institutional investors to gain exposure to altcoins.