CryptoQuant names conditions for altcoin growth this season

The material is not an investment recommendation and is published for informational purposes only.

What’s new? The head of the analytical company CryptoQuant Ki Young Ju states that the current season of altcoins will be “weird and challenging” contrary to the expectations of traders, who focused on historical data on previous cycles of growth of cryptocurrencies. The analyst notes that market sentiment is good, but liquidity is limited, meaning “only a chosen few will win the game.”

Source: X.com

What else is known? According to the analyst, bitcoin is distancing itself from the broader cryptocurrency ecosystem as it forms its own second-layer, securities-based ecosystem around it.

The question is about US spot exchange-traded funds (ETFs), launched in January on major stock exchanges and gathering $103,91 billion worth of bitcoins under management, as well as other investment products based on the first cryptocurrency.

Trading in options on spot BTC ETFs opened in the United States

According to analysts, thanks to this, the cryptocurrency exchange rate once again reached its all-time high in a month

Read more

This ecosystem of securities also includes shares of MicroStrategy (MSTR), which has accumulated 402 100 BTC since 2020, making it the largest holder of the asset on its own balance sheet among publicly traded firms. Since its first BTC purchase, MSTR’s value has increased by 1230%.

In addition, Donald Trump intends to create a national bitcoin reserve and support US miners so that most of the remaining coins from the limited supply of 21 million BTC will be mined domestically.

Marathon urges the US authorities to quickly increase mining capacity and BTC accumulations

According to the management of the largest mining company, the country’s leadership in these areas is important for maintaining national security

Read more

Following Trump, the possibility of creating a bitcoin reserve began to be discussed in South Korea, the UK, and Brazil. States such as El Salvador and Bhutan are already investing in the first cryptocurrency.

At the same time, the founder of MicroStrategy Michael Saylor promotes the bitcoin strategy among corporations. For example, he recently said that Microsoft could increase its value by $4,9 trillion by 2034 if it starts investing in bitcoin. Warren Buffett’s Berkshire Hathaway will stop losing $32 billion a year due to inefficient capital management thanks to a similar move.

Suriname’s presidential candidate Maya Parbhoe promises to replace the national currency with bitcoin in case of victory

According to the politician, this will combat widespread corruption by ensuring transparency and accountability of budgetary funds

Read more

Ki Young Ju notes that the direct correlation between most altcoins and bitcoin has significantly decreased. Now only a few projects are starting to show independent trends, attracting new liquidity.

According to the expert, altcoin teams have two options to sustain growth. The first involves creating their own ecosystems of securities similar to bitcoin, while the second involves creating an ecosystem of real internet money using stablecoins or bitcoin.

The head of CryptoQuant recommended that altcoin investors find a coin that can fulfill one of the two conditions and hold on to it for the long term.

After the approval of spot ETFs on bitcoin and Ethereum in the United States, the market expects such products based on the largest altcoins to appear. Several investment companies have applied in the US to launch exchange-traded funds for Solana (SOL) blockchain tokens and XRP tokens from fintech company Ripple. Similar products are already available on exchanges outside the United States.

Ripple инвестирует в европейский XRP-ETF от Bitwise

Продукт торгуется на платформе Xetra от Deutsche Börse под тикером GXRP с 2022 года

Read more

The TOTAL2 indicator — the total capitalization of the crypto market excluding bitcoin — is at $1,5 trillion at the time of writing, up 87,3% YTD.

In turn, the indicator BTC.D, the share of bitcoin in the total capitalization of the crypto market, is 55,79%, the capitalization of the asset has increased by 129,6% since the beginning of the year.