Crypto Traders Shift Focus to Altcoins, Neglect Bitcoin
According to crypto analytics platform Santiment, the level of discussion around Bitcoin among market participants has dropped to a three-month low. Traders are currently more interested in smaller altcoin projects and have sidelined Bitcoin as a result.
Rise in Altcoin Chats and Discussions
Santiment revealed that altcoins such as Loom Network (LOOM), Cream Finance (CREAM), and Solar blockchain (SXP) have experienced significant increases in chats and discussions. This suggests that traders are driven by greed and fear of missing out on potential gains from these projects.
These altcoins have seen substantial price surges recently. LOOM has surged by over 144% to $0.11 in just one week, CREAM has soared by 65% to $17, and SXP has spiked 2.5% to $0.28. Furthermore, these assets have also gained millions of dollars in market capitalization.
Other Outperforming Altcoins
In addition to LOOM, CREAM, and SXP, other altcoins like Frontier (FRONT), ImmutableX (IMX), and Chainlink (LINK) are also outperforming the broader crypto market.
Sentiment believes that LINK, FRONT, and IMX will continue their upward trend due to positive in-car metrics. LINK has been one of the best performers in September, with its price rising when it moves to exchanges.
Bitcoin Faces Liquidity Challenges
While altcoins thrive, Bitcoin is facing challenges with diminishing liquidity and trading volume. Since Q1 2023, there has been a decrease in circulating BTC on exchanges. The supply of BTC on trading platforms reached its lowest level since December 2017 as of August.
The decline in market liquidity is a major factor hindering BTC’s price growth. Spot and derivatives trading volume for Bitcoin have declined by 94% and 73% respectively since March 2024.
Santiment also noted that the number of addresses holding less than 100 BTC, which represents around 41.1% of the total supply, has reached a new all-time high.
Hot Take: Traders Shift Attention Away from Bitcoin
Traders in the crypto market are currently diverting their focus away from Bitcoin towards smaller altcoin projects. The allure of potential gains from these altcoins has led to a decrease in discussions about Bitcoin. Altcoins such as LOOM, CREAM, and SXP have experienced significant surges in price and market capitalization due to increased interest. Additionally, other altcoins like FRONT, IMX, and LINK are also outperforming the broader market. On the other hand, Bitcoin is facing challenges with decreasing liquidity and trading volume. The declining market liquidity has hindered BTC’s price growth. Despite these trends, the number of addresses holding smaller amounts of BTC has reached an all-time high.
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