The crypto market seems to be on the verge of revisiting the domain of an alt-season. Not only DeFi, but also other altcoins have been in a bullish trend for the last couple of weeks, while Bitcoin has basically stayed put. The disconnect between the bull markets in mid-cap altcoins and Bitcoin price is forming a strong case of altcoin run.
The average gain of top 20 cryptocurrencies by market cap is over 6%, while Bitcoin is trading in the $100 range around $9265. Moreover, the traders seem to be favouring mid-cap altcoins over top cryptos like Ethereum [ETH], XRP, Bitcoin Cash [BCH] and Litecoin [LTC].
Wow it really is an $ALT szn
— Koroush AK (@KoroushAK) July 8, 2020
DOGE Coin Mania and Social Media Volumes
Along with the DeFi mania, one notable instance is of the TikTok mania of Dogecoin. Users on the social media platform are apparently beginning a trend of buying $25 worth DOGE and become rich as the trend catches on and it reached $1.
Dogecoin [DOGE] was actually developed as a sarcastic attempt to highlight the pump and dump scheme with cryptocurrencies. WhalePanda, early Bitcoin investor and analyst notes,
Jackson created Dogecoin as a joke. He hated the fact that people actually bought, sold, invested and lost money with it. He’s pretty much against free market and capitalism.
Lunar crush, an analytics firm focusing on social media volumes tweeted,
there were 11,356 $doge social post mentions today coming from 9,730 social contributors. That’s an all-time high.
According to their analysis, Chainlink [LINK], Cardano [ADA], Dogecoin [DOGE], VeChain [VET] and ICX had the best score combining price and social media performance.
Bitcoin Dominance Percentage
The scope of Bitcoin [BTC] dominance expands to trading volumes and vastly different in market capitalization.
Bitcoin’s dominance has fallen below the 50 and 200-Day EMA (Exponential Moving Average) and has broken below the support from the uptrend in Bitcoin dominance.
Nevertheless, traders must be cautious about the continuation of the move. The rectangular area represents the fractal analysis of a similar breakout in early 2019. The market saw a rather quick reversion to Bitcoin as the gains compounded on altcoins early in 2019. Prominent trader and analyst, Cantering Clark (alias), tweeted,
Given that we see crypto is having its own version of sector rotation with DeFi, Midcaps, and now individual ridiculous things like $DOGE, it would be hard to imagine #Bitcoin not benefiting by more positive prices moving forward until the musical chairs game is over.
The ICO bubble of 2017 was built on the back innovative and potentially lucrative stance of blockchain technology transforming FinTech and various industries via decentralized crypto. The current rise in altcoins does not seem like a recycled altcoin run, but the fresh inflow of capital via DeFi. This new capital will tend to rotate or look for opportunities in other projects as well. The market capitalization of DeFi tokens has risen exponentially to $7,4 billion in the past few weeks.
Nevertheless, this is only the first phase of the rise and to replicate the previous alt-season it must continue for a while. Mati Greenspan, financial analyst and founder of Quantum Economics who is hopeful of a continuation noted on whether alt-season is here,
Nah. A season implies that it lasts a while. This is more like Alt-Wednesday with a hope of turning into Alt-July.
Rise in Stablecoin Supply
The market capitalization of stablecoins has been making new highs every day; currently at $11.2 billion. In the past, the inflow of money to stablecoins has acted as a precursor to crypto bull-markets.
Moreover, the scale of the increase in the USD stablecoin valuation is twice that of the increase in early 2019. This in addition to decreased volatility in Bitcoin price is again reminiscent of 2019.
Total Market Capitalization of Altcoins
Last but not the least, the market capitalization of altcoins has broken above the long-term bearish trend-line on a weekly scale.
Traders will be looking forward to a close and consolidation above the trendline for the continuation of altcoin runs.
What according to you is the probability of an alt-season in the current market? Please share your views with us.