The CEO of CryptoQuant, a blockchain intelligence platform, has a different perspective on the upcoming altseason in the cryptocurrency market. Unlike previous cycles, the chief executive believes that this altseason will be unique due to changes in liquidity flow between Bitcoin and altcoins.
According to on-chain analyst Ki Young Ju, the traditional finance sector’s increased participation in Bitcoin is a significant factor impacting the altseason. With the introduction of spot market BTC exchange-traded funds (ETFs) and the growing interest from companies like MicroStrategy, Bitcoin is drifting away from the rest of the crypto ecosystem. This shift in dynamics is expected to make the upcoming altseason “weird and challenging,” with only a select few emerging as winners.
Ju points out that the correlation between Bitcoin and altcoins has changed, with some coins showing independent trends as they attract new liquidity. He emphasizes that the traditional finance involvement has created a paper-based layer-2 ecosystem around Bitcoin, making it difficult for liquidity to flow seamlessly into altcoins.
The analyst also highlights the significant holdings of BTC by spot market ETFs, which now reportedly hold as much Bitcoin as the mysterious founder Satoshi Nakamoto. This accumulation of BTC by ETFs indicates a strong demand for the product, reaching historical highs.
In conclusion, the upcoming altseason is expected to be different from previous cycles, with unique challenges and opportunities for investors. The changing dynamics of liquidity flow and the increasing involvement of traditional finance in Bitcoin are reshaping the cryptocurrency market landscape. As the market evolves, investors will need to adapt to these new trends to succeed in the ever-changing world of cryptocurrencies.