After months of silence, the altcoin market still has not welcomed a breakthrough, and many investors have begun to question whether this round of bull market still exists. Renowned crypto analyst Michaël van de Poppe performed an in-depth analysis of this phenomenon in his latest video. He pointed out that the stagnation of altcoins is not due to fundamental issues with the projects themselves but rather because macroeconomic conditions and liquidity tightening have become key factors suppressing the performance of risk assets.
Are altcoin prices weaker than fundamentals? The crux does not lie in the projects themselves.
Van de Poppe believes that the current price trend of altcoins is severely diverging from their fundamental performance. Despite many quality projects steadily advancing in technology, ecology, and user growth, coin prices continue to be sluggish, frequently probing new lows. He points out that this situation is not a failure of individual projects but a systemic suppression caused by the external macro environment.
According to Mlion.ai's on-chain data monitoring, the on-chain activity, developer numbers, and capital flows of several leading projects have shown stable growth, yet prices have not reflected this synchronously, further confirming Van de Poppe's viewpoint.
He reviewed history and pointed out that similar situations also occurred in 2016 and 2020. At that time, the altcoin market was also stuck in a long-term slump, but it was this silent accumulation that became the fuse for the subsequent bull market.
Liquidity and Macroeconomics: The Real Cycle Drivers
In the past, many crypto investors firmly believed in the so-called 'four-year cycle theory,' thinking that the market would naturally evolve along the Bitcoin halving rhythm. However, Van de Poppe points out that with the massive influx of institutional capital, this simple model has become ineffective. Currently, global liquidity and macroeconomic data are the real engines of the market.
Mlion.ai capital flow tracking data shows that since 2022, with the continuous rate hike cycle of the Federal Reserve, liquidity has significantly withdrawn from high-risk assets, and the cryptocurrency market has not been spared. However, with recent expectations of interest rate cuts in the U.S., the strengthening of the RMB, and improved liquidity expectations in major global economies, the crypto market, especially Ethereum and altcoins, is regaining institutional attention.
Van de Poppe particularly emphasizes that Ethereum recently rebounded from a bottom in April, and the price trend's correlation with the RMB index is gradually strengthening. According to Mlion.ai's quantitative model inference, this positive correlation means that once global liquidity warms up, Ethereum and related altcoins will become the preferred choice for capital.
Institutional Capital: A New Driver for Extended Cycles
Another factor prolonging the cycle of the altcoin market is the deep involvement of institutional capital. Van de Poppe points out that with giants like BlackRock and Fidelity entering the crypto market, the logic of capital flow has undergone a qualitative change. The cycle has been extended, volatility has been smoothed out, and the short-term sentiment dominated by retail investors is gradually giving way to medium to long-term capital allocation led by institutions.
Mlion.ai sentiment analysis module data shows that the current fear and greed index of the cryptocurrency market is at a neutral to low position, far below the levels of a bull market frenzy. This kind of low sentiment is a typical characteristic before each round of bull markets in history.
Altcoins: Potential Low-Risk High-Return Window
Van de Poppe summarizes that the current market environment represents a low-risk window for altcoin investments. He points out that while there is still macro pressure in the short term, the downside potential is already quite limited. Historical data shows that Ethereum rose by 1900% at the bottom of the business cycle in 2017 and by 450% in 2021.
Mlion.ai's strategy section points out that from the perspective of capital flow and trading activity, the current altcoin sector shows preliminary signs of bottoming. Once macroeconomic uncertainties begin to ease, the altcoin market may usher in a long-awaited explosion.
Especially at this stage, relying on AI research assistants like Mlion.ai, investors can track on-chain data changes, capital flow trends, and social sentiment in real-time, accurately capturing turning points and avoiding blind chasing of highs or missing potential layout opportunities.
Summary
The stagnation of altcoins appears to be market silence, but in reality, it is a buildup of potential. The macro environment is gradually improving, liquidity is about to return, and institutional capital layout has quietly begun. When sentiment reverses, historical experience tells us that altcoins will have the opportunity to experience an astonishing surge.
The low period may be the best time for smart capital to quietly enter, and the opportunity window for investors may not last long.
Disclaimer: The above content is for informational sharing only and does not constitute any investment advice!