Bitcoin was fluctuating close to $118K al throughout Thursday, but come Friday, the token crashed to $115K. Since the crypto community was expecting the Bitcoin prices to appreciate, many of them had long positions. However, with the BTC crashing to $115K, nearly $600 million worth of long positions were liquidated. This crash drained 213,729 traders.
A crypto analyst who goes by the pseudonym Ash Crypto posted on X that “This dump is a pure leverage flush”.
In the post, Ash stated that many people took long positions on altcoins after seeing “ETH pumping hard.” Market makers saw this as a perfect opportunity to dump tokens and liquidate the long positions. However, despite the crash, the analyst believes that the altcoins will ricochet and pump up even higher.
Will the altcoins pump up, according to the analyst? Let’s take at the Altcoin Season Index, which denotes whether it’s an altcoin or a Bitcoin season.
CoinMarketCap’s Altcoin season index chart reads a value of 38. The value fell from 42 yesterday, moving closer towards the Bitcoin season. Generally, any value that is less than 50 on the indicator signals a Bitcoin season, while any value greater than 50 is supposed to be an altcoin season. The bottom line is that it is still Bitcoin season, and the altcoin season may arrive a little later. However, it is essential to check Bitcoin dominance or the market cap of Bitcoin compared to all the other tokens’ market caps. During an altcoin season, Bitcoin loses its dominance in the market, and the altcoins take over.
As the Bitcoin dominance fell from 61% to 60% it has made a new lower low. Despite making a new lower low, the Bitcoin dominance uptrend is still ongoing. This means that the Bitcoin dominance is still persisting. However, the altcoins and the other tokens seemed to have ended their downtrend. The altcoin dominance is at 27% and the other tokens have also picked up. As such, the dipping Bitcoin dominance, the increasing Ethereum and other token dominance could mean that the altcoin season is going through a period of transition from Bitcoin to altcoin season.
Defi researcher who goes by the pseudonym 0xNobler saw similarities between the altcoin season now and 4 years ago. According to the researcher, the altcoin season will start on August 1, as it did during the previous alt season. Since the altcoin season starts with low-cap tokens appreciating, 0xNobler expects the altcoins with low caps to explode by 200-250X.
