Why Ethereum Might Spearhead the Upcoming Altcoin Rally
The cryptocurrency market has entered a bearish phase in the medium term, with Bitcoin (BTC) slipping below the $61,000 mark this week. A significant outflow of funds from US-based spot Bitcoin exchange-traded funds (ETFs) in the past five days has dampened bullish sentiment.
On Friday, Bitcoin ETFs experienced their third consecutive day of inflows, totaling $11.8 million on June 27. Fidelity gained $6.7 million, Bitwise saw an increase of $8 million for BITB, and ARK received $1.8 million for ARKB. However, Grayscale witnessed an outflow of $11.4 million for GBTC, while BlackRock’s IBIT remained unchanged.
Poppe Predicts Altseason Imminent
According to prominent crypto analyst Michaël van de Poppe, the altcoin market is poised to gain bullish momentum against Bitcoin after a hiatus of more than two and a half years. Van de Poppe highlighted the resilience of the ETH/BTC pair amidst the recent downtrend. He suggested that the price of Ethereum against the US dollar could surge dramatically in the short term, as long as the ETH/BTC pair remains above 0.05.
In a recent post, he speculated on whether the forthcoming Ethereum ETF could trigger an altcoin season or signal a decline in altcoins. Despite prevailing negative sentiment, van de Poppe expressed optimism about altcoins, particularly Ethereum, which he includes in his portfolio. He emphasized the potential impact of an Ethereum ETF, noting its lower stock-to-flow ratio and deflationary characteristics compared to Bitcoin.
Impact of ETH ETF Approval
Van de Poppe delved deeper into the current market sentiment, which was pessimistic leading up to the ETF approval. He observed that Ethereum has rebounded by over 20% against Bitcoin since then. He suggested that if Ethereum surpasses the 0.06 BTC mark, it could ignite a broader rally among altcoins, benefiting projects within the Ethereum ecosystem such as Arbitrum and Optimism.
Looking Ahead
Historically, weak performance in altcoins during the first half of the year often gives way to strong momentum and returns from June onward, akin to Chainlink’s substantial gains in previous cycles. Van de Poppe also pointed to potential Federal Reserve rate cuts and declining treasury bond yields as factors that could accelerate Bitcoin’s recovery once current economic uncertainties settle. He anticipated a positive impact on Bitcoin, Ethereum, and the wider crypto market. Despite market corrections, van de Poppe maintained confidence in his investment strategy.
Future Prospects
The altcoin sector has already attracted significant attention from institutional investors, exemplified by the Solana ETP in Canada. Additionally, Bitcoin’s dominance is approaching a potential reversal point, likely triggering increased capital rotation towards altcoins.
Excited about the future of altcoins? Stay tuned for more insights.
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