- The Dencun update, the launch of Blast mainnet and EigenLayer may accelerate the growth of altcoins, experts said.
- Some analysts expect further growth in market capitalization.
- MVRV metrics indicate a number of assets are “overbought,” suggesting increased risks.
On Feb. 19, 2024, the Ethereum exchange rate reached $2980 for the first time in 22 months, according to TradingView.. The asset last traded above $3,000 in April 2022.
The market’s recovery has led many users to believe that the altcoin season is near. The prospects for further growth of altcoins are also reported by some experts:
I just increased my $MOCHI position:
- Price has bounced off of 0.612 Fibonacci retracement
- We’re entering an ETH bull market; beta for altcoins
- The rise of Pudgy Penguins has validated the thesis that cute things = mass appeal = market dominance
- The cat is cute especially pic.twitter.com/xzNK8zKgsa
— yuga.eth (@yugacohler) February 20, 2024
“We are entering an Ethereum bull market. It is the beta of the altcoin season,” Coinbase technical manager Yuga Kohler opined.
Apollo Capital chief investment officer Henrik Andersson told Cointelegraph about the upcoming “rally” in most assets. He expects the emergence of several catalysts that will accelerate the growth of cryptocurrencies. The expert referred to them as the Dencun update for Ethereum, the launch of the main network of the L2 protocol Blast and further development of the EigenLayer restacking protocol.
Trader and economist Mikybull Crypto told subscribers on X (formerly Twitter) that March was always optimistic for Ethereum. Technical analyst Titan of Crypto shared a chart of altcoin’s total market capitalization, hinting at further continued growth:
#Altcoins SURGING !💥🚀
The following chart shows the Crypto Total Market Cap Excluding #BTC and #ETH.
38.2% Fibonacci retracement level was the ceiling.
Now it’s game on. 🎮 pic.twitter.com/c41x61ATvk
- Titan of Crypto (@Washigorira) February 18, 2024
Possible risks
The head of 10x Research countered that he sees no evidence of an altcoin season yet. He explained that for other assets to grow, bitcoin’s market dominance would have to fall to 45% or lower. However, that figure is at 53%, according to TradingView.
According to the expert, the recent rise in altcoins has stopped, indicating that further bitcoin investments are likely. The momentum in Ethereum’s price is driven by rumors of possible approval of spot exchange-traded funds (ETFs) in May, rather than increased activity in the network and decentralized applications, he said.
Analysts at Santiment said that since the crypto market began recovering in October 2023, most projects have generated profits for investors. The company warned of signals indicating “overbought” assets. In particular, this is indicated by the MVRV metrics, which determine the ratio of the market value of cryptocurrencies to the realized value.
🧮 Based on average trading returns, many assets have seen understandably high profits since markets began booming all the way back in mid-October, 2023. Outside of a few lagging #altcoins, the vast majority of #crypto projects have generated profits for the average
(Cont) 👇 pic.twitter.com/ziKhzmcz1v
- Santiment (@santimentfeed) February 20, 2024
“This doesn’t mean that the cryptocurrency market is on the verge of a massive correction. But statistics and MVRV data indicate increased risks,” the experts said.
Recall, on February 13, analysts CryptoQuant warned of a possible correction in the price of bitcoin. They believe that at the current rate, many investors will begin to fix profits.
