Today we summarize the last days on the market with Sebastian Seliga from the zondacrypto exchange.
Sebastian Seliga: Another week behind us. What happened?
The cryptocurrency market has had another tough week. Investors haven’t felt such “extreme fear” in a long time. Some altcoins “fell to or below early 2024 levels.” However, there are already early signs suggesting a potential rebound.
Altcoin Season
Altcoin season is a market phase in which cryptocurrencies other than bitcoin (BTC) are seeing growth. In a note sent to our editorial team, Sebastian Seliga lists key indicators suggesting the upcoming altcoin season:
- Altcoin Market Cap Growth: Total cryptocurrency market cap excluding Bitcoin now stands at $940.37 billion, up 4.87% in the past 24 hours. This is a significant improvement from the 23.26% decline between June 6 and July 8.
- Bitcoin Dominance Declines: BTC dominance fell from 55.04% to 54.68% this week. By comparison, in 2021, when many altcoins reached their all-time highs, BTC dominance fell from 62.69% to 40.89%.
- The altcoin season index has risen from 25 to 45 over the last 90 days.
Market trends and narratives
Additionally, the following market trends dominated this week:
- Smart money is betting on memecoins. Meme tokens like PEPE, MAGA, PEIPEI, HOPPY maintain high positions in terms of capital inflows. Meanwhile, interest in so-called “safe bags” like interest-bearing tokens and liquid staking tokens has noticeably increased this week
- Ethereum and Solana continue to act as catalysts for the upside. Here, Seliga pointed to the “pending approval of Ethereum spot ETFs” and that “official applications for Solana ETFs have been filed by VanEck and 21Shares funds.”
Market prospects and scenarios
The zondacrypto expert further described the market prospects:
Selling pressure from the German government is being absorbed. All ETH spot ETF applicants have filed updated S-1s. VanEck and 21Shares have officially filed 19b-4s for spot solanine ETFs. While the data points to potential growth for the altcoin market, investors should remain cautious as further selling pressure is possible, which could derail growth. ETH has been underperforming against BTC over the past few months. However, the upcoming approval of Ethereum spot ETFs could trigger a significant increase in ETH value. If this happens, other altcoins could join the potential rally.
However, he warns that “the lack of significant inflows into Ethereum ETFs could dampen momentum,” while “volatility in the memecoin market could lead to wild price swings.”
Summary
As he sums up, “the altcoin market seems to be on the verge of potentially significant changes (…)”.
It will be crucial to monitor developments around ETFs, whale activity, and overall market sentiment. While the data suggests an approaching altcoin season, investors should be prepared for both possible gains and potential increased market volatility. If selling pressure hits the market again or Ethereum fails to attract impressive inflows into ETFs, the rally could be halted
– he added at the end of the report.
