Altcoins
Is the Bitcoin Rally Cooling Down in the Short Term? Altcoin Seasons Starts Brewing (Analysis)
On March 8, on-chain analytics provider Santiment reported that despite the incredible milestone achieved for Bitcoin, “there is currently a combined sense of altcoin exhaustion and distraction coming from the trading community.”
BTC prices briefly exceeded $70,000 on Coinbase on Friday marking a new absolute record for the digital asset.
However, it fell sharply from that level for the second time in a week, falling to around $68,000 a few hours later.
Bitcoin fervor fading?
So far, it has largely been institutions that have been driving the momentum in crypto markets with consecutive days of high trading volumes and entries for the recently launched Bitcoin spot ETFs.
Santiment also reported that social activity, or the percentage of discussions related to BTC compared to other assets, is currently at a fairly healthy level of 27.5%. However, it is not close to the levels of euphoria displayed when $60,000 was eclipsed less than two weeks ago.
“This is a good thing. FOMO and greed are usually the biggest signals.
He added that previously dormant pieces continue to put back into circulation at a rapid pace. This is one of the factors common to almost all bull markets, he says before adding:
“Until crowd euphoria and coin stagnation once again take hold on the Bitcoin network, market caps have the opportunity to continue climbing.”
Crypto investor Scott Melker was optimistic, narrative his 946,000 followers
“I think we will likely see a huge bubble and coins without fundamental value will also skyrocket before inevitably bursting.”
At the time of writing, the crypto market cap stood at $2.72 trillion, its highest level since December 2021 and just 12% below its all-time high.
JPMorgan on Bitcoin ETFs
Along the same lines, JPMorgan analysts have estimated that the potential size of the Bitcoin ETF market could reach around $62 billion. Net inflows into spot Bitcoin ETFs currently stand at around $9.2 billion, but some may have been withdrawn from similar products such as Grayscale’s GBTC, which has seen daily outflows since its conversion.
“This is a realistic target for the potential size of spot bitcoin ETFs over time, perhaps over a two to three year period,” wrote banking analysts led by Nikolaos Panigirtzoglou.