Key Points
- Coinbase analysts predict a potential altcoin rally following Donald Trump’s inauguration.
- Stablecoin inflows and weakening Bitcoin dominance are cited as indicators of the anticipated rally.
Analysts are suggesting that the cryptocurrency market might be preparing for a significant altcoin rally after the inauguration of Donald Trump. Analysts from Coinbase have observed a minor decline in the dominance of Bitcoin (BTC), which they believe fuelled the recent altcoin surge.
Indicators of an Altcoin Rally
The analysts also noted that traders seem to be preparing for a renewed altcoin momentum under the new administration. Chris Burniske, a partner at crypto VC firm Placeholder and former ARK Invest crypto lead, also shared this sentiment, referring to the decreasing BTC dominance.
David Duong and David Han, analysts at Coinbase, pointed out that stablecoin inflows are another bullish signal for a likely altcoin surge. They highlighted the strong capital inflows in the market and a large portion of it being directed to altcoins as BTC and Ethereum (ETH) recorded outflows.
Contrary Indicators
However, another indicator, the ETH/BTC ratio, did not align with the rest at the time of writing. This ratio tracks ETH’s performance relative to BTC, and it had rallied during November’s strong altcoin season. The ratio hit a new record low of 0.31 at the time of reporting. This could be a negative sign for the expected altcoin rally, especially if the trend from November repeats itself.
Nevertheless, altcoins such as Fartcoin and XRP experienced significant gains, with nearly 100% and 30% increases, respectively. Solana (SOL) also logged 30% gains, while Hedera posted 22% gains. It’s worth mentioning that Hedera and XRP were among the top performers in the November altcoin run. It remains to be seen whether they can maintain this momentum.
