Posted by Xoken.org – The significant increase in the crypto market in recent times has increased optimism among investors to reap profits. This sentiment was mainly influenced by the approval of the spot ETF Ethereum by the US Securities and Exchange Commission (SEC) some time ago, even though there is no green light yet on when it can be traded.
Inevitably, this significant crypto market bull run had a positive impact on Bitcoin and most altcoins, which rallied last week amid growing investor optimism.
At the beginning of the last week of May, the price of Bitcoin regained the level of US$70,000 or around Rp. 1.12 billion, because news from the European stock exchange strengthened, triggered by hopes of a cut in the European Central Bank (ECB) interest rate.
However, this increase did not last long, and BTC was again pressured by the downward trend so that it returned to trading below the level of US$70,000 or around Rp. 1.1 billion.
This is what Tokocrypto trader Fyqieh Fachrur said
Trader from Tokocrypto, Fyqieh Fachrur explained that Bitcoin must stay above the main support level at US$66,000 or around Rp. 1.06 billion to maintain bullish momentum.
However, according to him, obstacles such as US Personal Consumption Expenditures (PCE) inflation data and the many public speeches by Fed officials could eliminate positive sentiment from the market at the end of May.
“This week, all attention is still focused on a series of speeches by Fed officials, which are anticipated to provide insight into future US interest rate policy. Meanwhile, market players are eagerly awaiting signals amidst indications of declining US inflation,” explained Fyqieh.
Potential Altcoin Season Drives Significant Rise in Crypto Market
According to Fyqieh, currently the focus of crypto investors and traders is starting to speculate about the potential start of the altseason or altcoin season, which was triggered by the recent surge in total altcoin market capitalization.
Ethereum (ETH) is leading the rise in altcoins along with memecoins. ETH has experienced a significant increase, with its price hovering around US$3,991 (Rp. 64.2 million) or 27 percent over the past week.
According to TradingView data, the total altcoin market capitalization currently stands at around US$1.16 trillion, marking a 15 percent increase over the past two weeks. This surge is approaching resistance levels seen in mid-March when market capitalization reached US$1.2 trillion.
“Currently, we can indicate that we are in an altseason period, considering the significant increase experienced by several altcoins compared to Bitcoin. Bitcoin’s market capitalization dominance has weakened by 3.8 percent, which indicates that altcoins have performed better than Bitcoin. “When altcoins consistently outperform Bitcoin, this is a common sign of altseason,” explained Fyqieh in Tokocrypto’s statement to the media, Thursday (30/5/2024).
Fyqieh added that the altseason will probably undergo a consolidation phase before gaining full momentum. After Ethereum ETF, several other altcoins such as XRP, Litecoin (LTC), Solana (SOL), Pepe, Floki, and Notcoin will try their luck. The market seems bullish on accepting ETFs in an unprecedented way.
“The main drivers of altseasons usually involve several factors, such as increased adoption and use of blockchain-based applications that drive demand for certain altcoins. For example, the recent approval of an Ethereum spot ETF in the US is one factor that could accelerate the development of the Ethereum blockchain ecosystem, thereby encouraging demand and price of altcoins in the Ethereum ecosystem,” said Fyqieh.
The approval of an Ethereum ETF is seen as a catalyst for a potential altcoin season. However, due to the recording process, the full impact may not be felt immediately and may take months to materialize.
The impact of altseason on the crypto industry is very significant. In terms of transaction value, increasing altcoin trading activity can increase market liquidity and attract more new investors.
“In addition, altseasons often encourage technological innovation, as many altcoin projects develop new technologies and innovative solutions to capitalize on this momentum. As a result, we could see more project development and increased adoption of more sophisticated blockchain technology,” added Fyqieh.
It can be concluded that the impact of altseason is on the significant increase in the crypto market. In terms of transaction value, increasing altcoin trading activity can increase market liquidity and attract more new investors.