What to expect from top alts like Ethereum, XRP, LTC, ADA, LINK and DOT during BTC’s dip
The most recent bloodbath was a result of increasing liquidity across exchanges and a week ago, the 17th of April had the highest amount of BTC perpetual futures long liquidations so far in 2021. This was a key to...
The most recent bloodbath was a result of increasing liquidity across exchanges and a week ago, the 17th of April had the highest amount of BTC perpetual futures long liquidations so far in 2021. This was a key to Bitcoin’s price drop. Cascading sell-off has not yet hit, since the price has recovered to the $49000 level. Bitcoin’s hash rate dropped to the lowest level since November 2020 and these events were warning signs of the price drop.
Liquidations on BTC Perpetual Contracts || Source: Twitter
In terms of active trader participation, retail traders are yet to participate at the scale that they did in 2017 during Bitcoin’s bull run. Though currently institutional participation and HODLing have extended the alt season, trading activity on most altcoin networks is yet to hit pre 2018 levels and this is a sign that there is scope for the price to rally further.
In the case of DeFi tokens, the number of users has increased significantly throughout 2021 and the bull run.
Based on the above chart, total DeFi users have increased over time in the past week, the increase is nearly parabolic. The increase in unique addresses signals increasing investment inflow, demand and the comeback of several top DeFi tokens. Other metrics like transaction volume, realized market capitalization and on-chain activity are key to assessing the network growth and are also leading reasons for price drop in top altcoins.
Top altcoins to look at in the recent dip are ETH, XRP, LTC, ADA, LINK and DOT. The price for these alts made a comeback post the price drop. For some altcoins, like XRP, it has emerged as a pattern that XRP rallies once every four years following the Bitcoin halving pattern, however LINK’s correlation with BTC makes it rally when BTC’s price plummets.
These patterns are supported by on-chain evidence and price charts. Retail traders who align their buying pattern with network activity and these metrics have portfolios offering double-digit gains. The warning signs are evident from the on-chain metrics, network activity data and the trends in the price chart for Bitcoin and top altcoins in the current bull season.
Ekta is a full-time journalist at AMBCrypto and her specialization lies in spot markets. Currently pursuing her MBA, she is passionate about trading, fintech, and everything decentralized.
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