The research arm of Binance, the world’s largest crypto exchange by trading volume, published a report suggesting that a new “altseason” may be coming soon.
Rising interest for altcoins
The significant drop represents one of the “sharpest” month-over-month changes that BTC has seen on this platform. A further decline could indicate that market participants are becoming more interested in altcoins which could trigger a new altseason, according to the firm.
Binance Research affimred:
“If this trend were to continue, it would signify a greater appetite for altcoins from market participants.”
Although the crypto derivatives trading arm of this cryptocurrency exchange, Binance Futures, added 13 new altcoins perpetual contracts, Binance Research maintains that the trading dominance of BTC has fallen to a level not seen since June 2019.
Ethereum leads the pack
Meanwhile, demand for Ethereum rose significantly last month with a total monthly volume increase of 158.6 percent. The spike in interest in ETH could be related to a hard-fork that is scheduled for July. This system upgrade will change Ether’s consensus algorithm and improve its ASIC-resistance, said Binance Research.
ETHDenver, known as one of the largest Ethereum hackathons and conferences in the U.S., may have also encouraged market participants to turn their heads to ETH due to the various projects that aim to increase the utility of this cryptocurrency. Among them are Die Kitty Dai, Endaoment, and Ethance.it.
Despite the negative effect that the widespread transmission of coronavirus has had on the cryptocurrency market, over 75 percent of Binance’s users remain long-term bullish. These market participants are influenced by different on-chain metrics such as Bitcoin’s hashrate reaching all-time highs and its upcoming halving.
Likewise, long positions across all major altcoins are skyrocketing on Binance Futures.
Binance Research said:
“Sentiment on Binance Futures remains bullish as traders continue to pile on long positions throughout February. Binance Futures’ Long/Short ratio climbed to its highest of 1.7x despite the recent selloff in crypto-markets.”
As Japan’s largest drugmaker is working to develop a treatment for the coronavirus, investors seem to be slowly re-entering the market. A fresh capital inflow into the cryptocurrency market could be the catalyst for a new “altseason”.
Time will tell whether the state of commotion in the market will disperse allowing altcoins to surge once again.