The current growth in alternative cryptocurrency trading has led to the dominance of the altcoin market, which refers to the percentage of the cryptocurrency market that consists of altcoins (other than Bitcoin cryptocurrencies), reaching 50%. All citizens are happy about this trend, but some experts predict that it may lead to failure in the near future.
Warning: Altcoin Crash is Coming!
According to JA Maartun, crypto analyst and community manager for CryptoQuant, the fact that the trading volume of altcoins has reached 50% is concerning.
See Maartun’s chart below:
Maartun showed the graph above to support his statement that in the past, when the share of altcoins in the market was more than 50%, a significant decrease in the price of BTC often led to a similar appearance of profit in d markets again.
The chart shows that the price drop of November 2022 is a period of increasing altcoin capacity, with other cryptocurrencies accounting for 55% of the total trade.
This comes at a time when market sentiment is already bleak and many investors are reluctant to invest in risky assets, despite evidence of crypto investments expected in 2023.
The US Consumer Price Index (CPI) data will be released on January 12, and some experts predict that it will show an upward trend. If so, the Federal Reserve may continue to raise interest rates, which has already caused the market capitalization of cryptocurrencies to end. If the future increase in interest rates is combined with the current bad behavior of the market, DCG can cause bankruptcy and reduce market liquidity, this can lead to another failure not only of the altcoin market, but also of the general cryptocurrency market.