Why Altcoin Market Crashed Heavily Last Week 🚨
The crypto market is consolidating after a rally from October to March. While Bitcoin and Ethereum are only 15% below their yearly highs, major altcoins like Solana and Avalanche have dropped 40% to 50%. Layer-1 tokens such as SUI and Aptos have fallen 60% to 70%. This decline is driven by token unlocks, venture capital sell-offs, and a lack of new money in the market.
#### Token Unlocks and Selling Pressure
Many altcoins are suffering from increasing token supplies due to scheduled unlocks. For example, Solana's supply grows by 74,000 tokens daily, worth about $10 million. This, along with venture capital funds cashing out, is driving prices down.#### Stagnant Liquidity InflowsCrypto market liquidity inflows have stalled, with the stablecoin market cap remaining flat since April. The combined market cap of top stablecoins (USDT, USDC, FDUSD, and DAI) shows reduced trading activity and investor interest.
#### Seasonal Trends and Market Cap Drops
June is historically tough for altcoins. As of June 22, 2024, the aggregated market cap of crypto assets excluding BTC and ETH is $594.967 billion, down 14.30% over the past month.In summary, the market consolidation is hitting smaller altcoins hard.
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