Mon 19 Aug 2024 ▪
3
min read ▪ by
The cryptocurrency market is going through a tumultuous period, marked by a significant drop in altcoins, notably Ethereum (ETH) and Solana (SOL). Since the beginning of March 2024, the market capitalization of altcoins has fallen from approximately $1.27 trillion to approximately $866 billion. This dramatic decline has been fueled by the decline in global stock indices and massive token sales by venture capital funds.
The causes of the cryptocurrency market crash
Several factors contributed to this crypto crash. Continued selling by Jump Trading, which liquidated a large portion of its Ethereum holdings, sent shockwaves through the altcoin sector. Additionally, the recent sale of 10,000 BTC by the US government intensified fears of a capitulation, sending Ethereum’s Fear and Greed Index down to 34%.
Altcoins, especially those like Solana and Avalanche (AVAX), have seen corrections of 40-70% in recent months. This selling pressure is exacerbated by crypto token unlocks and distributions scheduled in the coming years. For example, the Arbitrum network has seen a massive increase in its token supply, which has driven its price down despite a rising market cap.
A glimmer of hope?
Despite this difficult situation, some analysts see an opportunity. Michaël van de Poppe, a renowned crypto analyst, recommends practicing Dollar-Cost-Averaging (DCA) in the altcoin industry, in anticipation of the next bull run. He notes that Bitcoin dominance is showing signs of reversal, which could indicate an upcoming altcoin recovery.
Altcoin season is in jeopardy, but all is not lost. Cryptocurrency holders should remain vigilant and ready to seize opportunities to buy at low prices. The current volatility could provide attractive entry points for those who believe in the long-term resilience of altcoins. In the meantime, it is essential to closely monitor market developments and stay informed about global economic trends.
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The world is changing and adaptation is the best weapon to survive in this undulating universe. As a crypto community manager at heart, I am interested in everything that is closely or remotely related to blockchain and its derivatives. With a view to sharing my experience and making known a field that fascinates me, there is nothing better than writing informative and relaxed articles at the same time.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be considered investment advice. Do your own research before making any investment decision.
