Altcoin Market Bleeds as Bitcoin Fails to Take Off

The cryptocurrency market painted a bloody picture on Monday, with major altcoins taking a significant tumble. While the exact cause remains

Written by: Arslan Butt • Tuesday, June 18, 2024 • 2 min read

• Last updated: Tuesday, June 18, 2024

Altcoin Market Bleeds as Bitcoin Fails to Take Off

The cryptocurrency market painted a bloody picture on Monday, with major altcoins taking a significant tumble. While the exact cause remains unclear, analysts point to potential factors like reduced interest in spot Bitcoin ETFs and a broader market correction.

Altcoins Feel the Heat

Shiba Inu (SHIB) and Avalanche (AVAX) were the hardest hit, dropping over 12% in a single day. Other major altcoins like Uniswap (UNI), Dogecoin (DOGE), and Solana (SOL) also witnessed double-digit losses. Bitcoin (BTC) and Ethereum (ETH) fared slightly better, but still experienced declines.

Analysts Offer Explanations

Henrik Anderrson, from Apollo Crypto, suggests reduced interest in spot Bitcoin ETFs might be a contributing factor. Data shows outflows from these ETFs in recent days. Digital asset firm 10xResearch believes the altcoin crash is tied to the weak Bitcoin ETF flows.

Bitcoin Miners Shine Despite Market Gloom

In contrast to the broader market slump, Bitcoin mining stocks have seen a positive trend in recent weeks. This is likely due to renewed confidence in the mining sector post-halving event.

The Future of Altcoins: A Debate Rages On

Some analysts remain optimistic, like Dami-Defi, who believes altseason is still on the horizon. Others, like Crypto With Khan, highlight the risks associated with altcoins, emphasizing the need for strong internal fundamentals. Andrew Kang suggests a potential divergence between Bitcoin and altcoins in the long term.

Understanding the Altcoin Landscape

Analyst Lark Davis emphasizes the importance of thoroughly assessing altcoins before investing. He categorizes altcoins into subcategories, including established layer-1 blockchains, layer-2 solutions, utility projects, and meme coins.

Memecoins: A Volatile Mix

Dogecoin’s success story exemplifies how meme coins can carve a niche for themselves. However, extreme volatility and short-lived popularity remain major risks associated with this category.

Buying Opportunity for Patient Investors?

The recent price drops have caused a decline in social media sentiment for major altcoins. Analytics firm Santiment views this as a potential buying opportunity for patient investors. On-chain data suggests long-term holders haven’t wavered, potentially indicating confidence in long-term potential.