In the past 24 hours, the digital asset market has shown declines, with many altcoins dropping, raising questions about the future growth and 'altcoin season'.
Decline in Altcoin Prices
Over the last 24 hours, the cryptocurrency market, according to CoinMarketCap data, has exhibited negative dynamics.
At the time of publication, the price of Bitcoin was $118,945.82, down 1.5%.
The leading altcoin, Ethereum, fell by 2.12%, priced at $4,622.36.
XRP also decreased by 3.65% to $3.10.
The largest drop among major assets was for Solana, which saw a decline of 5.21% to $193.17.
Other key altcoins, such as Binance Coin, Cardano, and Dogecoin, also experienced declines of 1.97%, 2.88%, and 3.60% respectively.
Signs of Liquidity Recovery
Coinbase Institutional stated in its latest report that a full altcoin season could commence as early as September.
Key factors contributing to positive changes include expected interest rate cuts in the United States and anticipated developments in cryptocurrency regulation.
The Altcoin Season Index from CoinMarketCap currently stands at 40%, which measures how many altcoins are outperforming Bitcoin over 90 days.
To initiate an altcoin season, this reading needs to reach 75%.
Coinbase also reported that liquidity, which had been falling for six months, has started to recover due to increased trading volumes and a more stable issuance of stablecoins.
What History Shows and What Could Happen Next?
The shift in Bitcoin dominance noted by trader Gordon resembles changes seen four years ago before a prolonged rally in altcoins.
While this does not guarantee a similar outcome, it has attracted market participants' attention to specific assets.
Some analysts believe that better liquidity, increased institutional interest, and technical patterns could drive altcoin growth later this year.
However, others caution that the current price drops may indicate traders' cautiousness in the short term.
Currently, the market is in a holding stage, showing signs of a potential rally. It is crucial to remain cautious and consider global economic conditions that may influence developments in the coming months.
