Is the cryptocurrency market about to explode? Altcoin Daily analyst Aaron Arnold, in a recent YouTube video analysis, suggests that we are currently in the “calm before the storm” for altcoins. The main trigger for the next altcoin season should be Bitcoin hitting $70,000 and Ethereum reclaiming $4,000.
Arnold’s analysis goes beyond these price targets, looking at historical trends, market indicators and institutional involvement. Here’s a look at his thoughts.
The Wealth Effect: How Bitcoin Boosts Altcoins
Historically, altcoins tend to spike in value when Bitcoin surpasses its previous all-time highs. This phenomenon, known as the “wealth effect,” occurs when Bitcoin and Ethereum holders begin to diversify their profits into smaller-cap altcoins, triggering a market-wide rally. Additionally, new investors who feel like they missed out on Bitcoin and Ethereum often flock to altcoins, pushing prices even higher.
Arnold also points to Bitcoin’s current consolidation near its previous highs, indicating that a major breakout could be on the horizon. He points to indicators such as 45% of Bitcoin’s supply remaining intact over the past six months, suggesting strong accumulation, a precursor to a significant price rally.
Will Institutions Fuel the Next Big Rally?
Another critical factor Arnold talks about is the interest in Bitcoin from global institutions. Entities like Metaplanet and Japan’s Goldman Sachs are making significant investments, showing increased confidence in the asset. With growing adoption, potential ETF approvals, and institutional support, Bitcoin’s momentum could spill over into the altcoin market.
Top Altcoins Ready to Take Off!
As Bitcoin and Ethereum approach their crucial price thresholds, several altcoins are poised for notable gains. Here are the top contenders:
Solana (SOL)
Solana stock price is expected to resume its uptrend and could surpass $250. The recent launch of a Solana spot ETF in Brazil and its integration with PayPal’s stablecoin are positive developments that could lead to further price gains.
Aptos (APT)
Aptos is making waves with its impressive transaction capabilities, handling 50x more daily transactions than Ethereum and 10x more than Base. This scalability could lead to substantial growth as more users and projects adopt the platform.
Injection protocol (INJ)
Injective protocol is becoming increasingly relevant in the DeFi space, with its focus on decentralized derivatives and trading. The platform’s interoperability and partnerships suggest potential for significant price action.
Toncoin (TON)
Toncoin, associated with Telegram’s blockchain project, is attracting increasing interest due to its strong community and technical advancements. Its interoperability and unique use case make it a promising candidate for future growth.
Creator (MKR)
Maker is gaining more attention as its governance and decentralized finance features continue to expand. Grayscale’s launch of new Maker-focused funds underscores its growing importance in the DeFi ecosystem.
On the other side
The Altcoin Season Index suggests that an altcoin boom is not imminent. Currently, the market is dominated by Bitcoin, with BTC becoming increasingly dominant. For a true altcoin season to begin, at least 75% of the top 50 altcoins must outperform Bitcoin over the past 90 days. Given the current market dynamics, altcoin enthusiasts may not see any significant gains this month. However, by the end of Q3, the trend could turn, providing a potential window for altcoins to shine.
Despite the current bearish sentiment, Arnold remains optimistic. He concludes that the ground is ripe for a massive surge in Bitcoin and altcoins, with prominent figures like Arthur Hayes predicting a robust altcoin season once Bitcoin and Ethereum hit their target prices.
Also see: What’s next for Ethereum and Solana? Consolidation and key levels explained
Will altcoins finally steal the show? Time will tell. Share your bets.
