New data from Glassnode has revealed that the world market for Altcoin is undergoing one of its strongest devaluations in history.
Meanwhile, Bitcoin (BTC) remained relatively stable despite volatile price oscillations. This presents a striking divergence between the largest cryptocurrency and the wider Altcoin sector.
Altcoins are faced with historical devaluation
The latest Glassnod chain newsletter detailed the volatility of the Bitcoin market last week. Macroeconomic conditions, including the prices offered by President Trump in Canada, Mexico and China, were listed as driving acts behind him.
These geopolitical tensions have created an uncertain environment for investors. In addition, the continuous force of the US dollar has contributed to a constrained liquidity environment.
Despite these fluctuations, Bitcoin has demonstrated relative stability, fluctuating between a minimum of $ 93,000 and a summit of $ 102,000. This indicated a market generally laterally.
Glassnod’s analysis has attributed stability to increased liquidity and greater capital flows, compensating for the momentum of an increasing asset.
“The growing presence of a more resilient patient holder has contributed to the stability of BTC prices, even in the middle of a relatively unstable macro backdrop,” noted Glassnode.
Unlike the relative resilience of Bitcoin, altcoins have been faced with significant challenges. Using the analysis of the main components (PCA), Glassnode said that most ERC-20 tokens were closely grouped, indicating a large-scale sale on the Altcoin market.
This suggests that very few altcoins have managed to avoid volatility and to move independently.
“The Altcoin sector has undergone the heaviest losses during the slowdown, the global market capitalization of Altcoin undergoing one of its largest devaluations ever recorded,” said the bulletin.
The severity of this sale was obvious in the world market capitalization of Altcoin, which saw a drop of 234 billion dollars over a period of 14 days. However, Glassnode acknowledged that this drop was not as serious as the previous accidents. These included the great migration of minor in May 2021 and the collapses of Luna / UST and 3AC at the end of 2022.
Is the Altcoin season always a possibility?
Meanwhile, a crypto analyst on X drew attention to a recurring trend in cryptographic cycles. The analyst stressed that the dominance of Bitcoin culminates by reaching new heights of all time, while the dominance Altcoin strikes the stockings. This phase often creates a feeling of despair among Altcoin investors, who feel late in the cycle.
However, based on past trends, the analyst revealed that Bitcoin’s domination generally decreases after his second price leap to new records. This is followed by an increase in the domination of Altcoin.
“I always expect the domination of Bitcoin to decrease and the domination Altcoin increases,” said the post.
However, the analyst has examined that the current cycle is more intense due to more altcoins and fewer investors with Bitcoin at higher prices. Thus, the monetary flow first follows Bitcoin, then major altcoins, and finally low and low capitalization altcoins.
Another analyst also underlined a major signal for the Altcoin season.
“Some altcoins are available from Bitcoin for the first time since 2022 – this is the first signal of the Taurus!” he said.
The analyst believes that significant Altcoin rallies are likely before bitcoin is officially declared reserve currency. He expects Bitcoin’s benefits to rush into Altcoins, which could trigger a season of Altcoin.
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