The altcoin market is thawing

Market overview

The crypto market capitalisation has risen by over 2.2% in the past 24 hours to $2.66T, bringing it closer to the midpoint of the range seen over the past month. This time, the positive momentum was underpinned by rising stock indices and a general appetite for risk. The media noted that the start of a rate-hiking cycle is a positive rather than a negative event for risk appetite. However, in their reaction, cryptocurrencies slightly anticipated the subsequent rebound, which might have seemed surprising a day earlier, thereby regaining their status as a leading indicator for traditional markets. In our selection of the forty most liquid coins, none saw a decline. The top performers were NEAR Protocol (+30.1%), Uniswap (+26.2%) and Aptos (+17.9%). The heavyweights Tron (+0.1%, 8th by market capitalisation), Bitcoin (+1.4%, 1st), Ethereum (+1.8%, 2nd) and XRP (+1.8%, 5th) underperformed the rest. It appears that traders are cautiously shifting their focus towards altcoins, although neither the altcoin season index nor market sentiment has yet reached high levels. 

Bitcoin has gained relatively modestly over the past 24 hours, marking the third consecutive day of gains and a recovery towards $77.5K. A rally up to the region near $82K could be a relatively easy ride for the bulls, but beyond that, they will have to contend with resistance from an established range, breaking out of which may require an external catalyst. If successful, the next upside target appears to be the $94K region, near which lies the 161.8% Fibonacci extension level following the August rally and subsequent consolidation. This is also where the upper boundary of the December 2025–January 2026 consolidation range lies. In our view, Bitcoin will postpone such an ambitious move until next week, as it faces pressure to take short-term profits ahead of the weekend.  

News background

Three days of outflows from US spot Bitcoin ETFs also point to subdued investor sentiment. Wintermute believes that the outflow of capital from Bitcoin ETFs has weakened one of the key factors supporting BTC’s growth in recent months.

Bitwise believes that following the failure of the vote on the CLARITY Act, the crypto market can continue to grow even without its adoption. Wall Street is counting on a favourable approach from the current leadership of the SEC and CFTC.

Mark Yusko, CEO of Morgan Creek Capital, stated that Bitcoin's fair value is $105K according to Metcalfe's Law. The rule states that the value of a network grows in proportion to the square of the number of its users; in other words, it depends on the number of active addresses and the volume of transactions on the BTC network.

The US House of Representatives’ Financial Services Committee has approved a bill to establish a federal strategic Bitcoin reserve. The full House of Representatives must now vote on it, then the Senate, and subsequently be signed by the President. The law will authorise the Treasury to purchase cryptocurrency using public funds, but not through borrowing, taxation or in the event of a budget deficit.