Is the Altcoin Rally Imminent? Significant Whale Accumulation Suggests Volatility Ahead
Despite Bitcoin’s price rebounding from the $67,500 support level, the altcoin industry continued to experience choppy markets on Thursday. However, there are signs of an imminent rebound in the near future due to increased demand from institutional and retail investors. Additionally, spot Bitcoin ETFs in the United States have seen over ten consecutive days of cash inflows, and the cryptocurrency industry eagerly awaits the trading of spot Ethereum ETFs.
The crypto market has been in a correction mode for the past two months, but now most crypto assets are indicating a bullish rally ahead. On-chain data shows that the accumulation rate of crypto whales is at an all-time high, suggesting significant volatility in the future. This situation is reminiscent of mid-2020 when Bitcoin hovered around $10k for six months with high on-chain activity, later revealed to be OTC deals. Despite the current low price volatility, on-chain activity remains high, with $1 billion added daily to new whale wallets, likely for custody purposes.
The crypto issue is becoming more prominent in the United States as the general elections approach. Former President Donald Trump’s recent conviction of falsifying business records adds to the complexity of the situation. Trump had previously shown support for the crypto industry and vowed to prevent the creation of a central bank digital currency (CBDC) by the Federal Reserve. His case further complicates the political landscape surrounding cryptocurrencies.
In recent weeks, the meme coin market has gained significant attention. Many meme coins have emerged, some of which have experienced rug pulls while others have gained traction. Crypto investors have been diverting their resources to meme coins in search of maximum gains, often disregarding utility-based projects. In the past 72 hours, Dogecoin whales have purchased over 700 million DOGE coins, worth approximately $112 million. This trend follows a similar pattern seen with Pepe investors, who have accumulated over 700 million coins in recent days.
Overall, the altcoin industry is facing choppy markets, but there are indications of a rebound in the near term. The United States political landscape and the rise of meme coins are contributing factors to the current market volatility. Investors are eagerly awaiting the trading of spot Ethereum ETFs and closely monitoring the cash inflows into Bitcoin ETFs.