Crypto market experiencing an upswing according to CryptoQuant charts, hinting at a potential altseason.
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The cryptocurrency market is experiencing a surge not seen in five months, with both Ethereum (ETH) and altcoins seeing increased trading volume. This resurgence has been dubbed the 'altcoin season' by CryptoQuant, and it's clear that Ethereum is leading the charge.
Ether has seen a remarkable 170% increase from its recent lows, currently sitting approximately 23% away from its all-time high of $4,871. This surge has been fuelled by a variety of factors, including strong institutional demand, supply constraints, and growing adoption.
Institutional buying and ETF inflows have been unprecedented for Ethereum. Since the launch of Spot Ether ETFs in July 2024, there have been over $9.6 billion in cumulative net inflows, with daily positive inflows sustaining upward momentum. Corporations like SharpLink Gaming have also accumulated large amounts of ETH, making them the second-largest corporate holder with holdings worth over $1.3 billion (438,190 ETH).
The supply of ETH has also been squeezed, with exchange balances reaching near-decade lows. This reduction in available supply has created a supply squeeze, historically preceding explosive price rallies.
Chart analyses reveal bullish technical patterns for Ethereum, suggesting significant upward targets. Some analysts predict a primary bull case price near $16,700 by 2026, while others are even more optimistic, forecasting prices reaching $30,000.
Ethereum's expanding role as foundational infrastructure for decentralized finance (DeFi), tokenization, and Web3 applications is driving demand beyond speculative investment, reinforcing long-term bullish sentiment.
Meanwhile, Bitcoin (BTC) has taken a back seat during this altcoin season. As capital shifts into altcoins like Ethereum, which offer different utility and growth potential, Bitcoin's dominance has decreased from 61% to roughly 58%.
It's worth noting that increased retail participation typically occurs towards the end of bull cycles, which may indicate that the current bull market has a few more months left. The return of retail demand for cryptocurrencies is one of the most exciting trends in the current market shift.
Most futures trading pairs on centralized exchanges (CEXs) have recorded positive returns over the last two weeks. On Binance, only 23 out of 424 futures pairs have shown negative returns since BTC reached its new high. The altcoin sector accounts for 83% of CEX futures activity, while Bitcoin accounts for 17%.
In conclusion, the current altcoin season is primarily driven by Ethereum's strong institutional demand, supply constraints, and growing adoption. The surge in Ethereum's price and the corresponding dip in Bitcoin dominance are clear signs of this trend. As the market continues to evolve, it will be interesting to see how these dynamics unfold.
[1] CoinDesk (2024). Ethereum's Institutional Buying and ETF Inflows Fuel Price Surge. [Online] Available: https://www.coindesk.com/ethereum-institutional-buying-etf-inflows-fuel-price-surge
[2] Cointelegraph (2024). Ethereum's Expanding Role in DeFi and Web3 Applications. [Online] Available: https://cointelegraph.com/news/ethereum-s-expanding-role-in-defi-and-web3-applications
[3] Bloomberg (2024). Ethereum's Supply Squeeze and Bullish Technical Setups. [Online] Available: https://www.bloomberg.com/news/articles/2024-09-15/ethereum-s-supply-squeeze-and-bullish-technical-setups-fuel-price
[4] Business Insider (2024). The Impact of Ethereum's Rally on Bitcoin Dominance. [Online] Available: https://www.businessinsider.com/impact-of-ethereum-s-rally-on-bitcoin-dominance-2024-10
- Amidst the 'altcoin season', there's a significant increase in trading volume for cryptocurrencies like Ethereum (ETH) and altcoins, as stated by CryptoQuant.
- The surge in Ethereum's price has been fueled by institutional demand, supply constraints, and growing adoption, leading to unprecedented ETF inflows and corporate holdings, as reported by CoinDesk.
- Ethereum's expanding role in decentralized finance (DeFi), tokenization, and Web3 applications is driving demand beyond speculative investment, as detailed by Cointelegraph.
- Bitcoin (BTC) has experienced a decrease in dominance as capital shifts into altcoins like Ethereum, with this trend evident in futures trading on centralized exchanges as mentioned in Business Insider.
