Original | Odaily Planet Daily (@OdailyChina)
Author | Fu Ruo (@vincent31515173)
The cryptocurrency market seems to no longer be dominated solely by Bitcoin, with funds flowing into mainstream altcoins.
According to Quantify Crypto data, in the past 24 hours, among the top 200 cryptocurrencies by market capitalization, 185 tokens have risen, while only 15 tokens are in a downward state. Among the top hundred tokens, most have risen over 8%, with ETH breaking through 3400 USDT, a nearly 10% increase in 24 hours; SOL breaking through 260 USDT, reaching a historical high; Ethereum Layer 2 OP and ARB both rising over 15%. On social media, many users are calling out that the "altcoin season" has finally arrived.
But whether the altcoin season has truly arrived is still to be determined. Therefore, Odaily Planet Daily will explain the reasons for the rise in altcoin prices and analyze whether it can be sustained. (Note from Odaily Planet Daily: The author has separated the on-chain memes from the altcoin category, with memes on leading exchanges categorized as altcoins.)
Why are altcoins rising?
The trading volume of well-known memes on-chain is declining, and community discussion levels have decreased.
Previously, as Bitcoin's price continuously broke new highs, altcoins fell instead of rising, leading some users to be skeptical about this bull market for altcoins, especially those VC tokens facing large-scale unlocks.
Therefore, the market's attention has turned to launching a fairer meme sector, leading most funds to flow into on-chain PVP. The once mainstream altcoins face the situation of having significant market capitalization but less liquidity than a newly exploded meme project. For example, among the current top 100 tokens, the 24-hour trading volume is even less than that of the recently popular CHILL GUY.
However, the high-intensity PVP of memes also deters people, and it is inevitable for funds to return to altcoins, gradually evolving into a new mechanism: Bitcoin breaks through first, followed by the rotation of funds between memes and altcoins. One reason for the rise of altcoins this time is the decline in the heat of on-chain memes.
The trading volume of well-known meme coins has begun to decline, such as ai16z, RIF, and ELIZA, which were previously popular meme coin representatives. According to GMGN data, most trading volumes have been halved.
Community discussion levels are declining. In most meme communities where I am, discussions have shifted from which meme projects to chase to how to persistently wait for the next wave of meme speculation.
The SEC chairman's imminent departure has triggered a frenzy in altcoins.
Since the approval of Bitcoin and Ethereum spot ETFs, the cryptocurrency market has begun to rise continuously, with the market looking forward to the next cryptocurrency to go mainstream.
Today, Bloomberg senior ETF analyst James Seyffart published, "Cboe has submitted applications for 4 Solana spot ETFs to the SEC, with issuers being VanEck, 21Shares, Canary Capital, and Bitwise. If the SEC does not reject the above document applications, the final deadline will be around early August next year."
The application for cryptocurrency spot ETFs requires issuers to prepare two documents, namely S-1 and 19b-4. This time it is the S-1 document, representing the request for the SOL spot ETF to go public. The documents that truly face review difficulties are mostly concentrated in 19b-4, so the SOL spot ETF is just getting started.
However, SEC Chairman Gary announced on platform X that he would officially resign on January 20. The newly appointed SEC chairman may expedite the review process for the SOL spot ETF, and it may not have to be extended to the final deadline like the previous Bitcoin and Ethereum ETFs.
Moreover, Gary's impending departure has allowed heavily regulated altcoin projects to catch their breath. Ripple, which has had a long-standing grudge with the SEC, saw its token XRP increase by nearly 30% in a single day.
With the push from regulatory bodies and the SOL spot ETF, it is reasonable for altcoins to see an increase.
Can altcoins continue to rise?
Whether the frenzy of altcoins can continue still requires observation and verification from more dimensions.
From historical experience, the altcoin market is often driven by short-term heat, but whether it can truly maintain price increases depends on the long-term development ability of the projects and the overall market environment. Although there are calls for an "altcoin season" in the current market, without new technological breakthroughs, application implementations, or ecological development support, this wave of market activity may be more about short-term capital rotation rather than a trend-driven increase.
Therefore, for both institutions and individual investors, it is essential to remain vigilant in the face of this wave of altcoin activity. On one hand, attention should be paid to changes in the flow of funds in the market, such as key indicators like on-chain token transfer data; on the other hand, it is also necessary to guard against the risk of a pullback after short-term gains, especially as the funding movements of leading projects may become an important indicator for subsequent market trends. Currently, the "altcoin season" remains a battleground of opportunities and risks, and investors should stay calm.
