Author: Azuma, Odaily Planet Daily
The cryptocurrency market seems to have entered a stage of accelerated surge; following a substantial increase the night before, the market welcomed another wave of more violent rises last night.
According to OKX market data, BTC surged to 117,548.2 USDT last night, and as of 8:30 this morning, it is reported at 115,408 USDT, a 24-hour increase of 3.75%; even more surprising is the altcoin benchmark ETH, which broke the 3000 mark last night, hitting a high of 3002.99 USDT, and as of this morning at 8:30, it is reported at 2972.21 USDT, a 24-hour increase of 5.77%; another altcoin leader SOL is reported at 162.7 USDT, with a 24-hour increase of 4%.
Due to the overall rise in the market (especially since ETH is no longer stagnating), the altcoin market has also welcomed a strong recovery. As of this morning at 8:30, multiple coins among the top 100 altcoins recorded double-digit increases, including SUI at 3.42 USDT, a 24-hour increase of 11.7%; ARB at 0.3915 USDT, a 24-hour increase of 11.1%; PEPE at 0.00001218 USD, a 24-hour increase of 11.2%; PENGU at 0.0194 USDT, a 24-hour increase of 26.18%...
According to CoinGecko, the total market capitalization of cryptocurrencies has surpassed 3.669 trillion USD. In terms of market sentiment, the trading enthusiasm among crypto users has also significantly increased, with today's fear and greed index reaching 71, indicating 'greed'.
In derivatives trading, Coinglass data shows that in the past 24 hours, the entire network has liquidated 1.078 billion USD, most of which were short liquidations, totaling 969 million USD. In terms of coin types, BTC had liquidations of 583 million USD, and ETH had liquidations of 242 million USD.
Reasons for the rise: tariff 'desensitization', institutional accumulation, rate cut expectations.
Regarding the reasons for the current market upswing, we provided some analysis in yesterday's market trend article (BTC Hits New High of 112,000, ETH Leads with 7%, Is the Dawn of Altcoin Season Emerging?).
On the one hand, the market has gradually realized that the collective psychological impact brought by this round of tariff disputes has significantly weakened - just like the story of 'the boy who cried wolf', when a story is told multiple times, its deterrent effect naturally diminishes, and the panic impact of the tariff war on the crypto market and even the global economy has significantly decreased.
On the other hand, the institutional buying power, including ETFs, continues to expand. As of July 10, the spot Bitcoin ETF has maintained positive inflows for five consecutive days, and after SOL opened up the ETF channel, more altcoin ETFs are also expected to be approved for listing; in addition, more listed companies, apart from established BTC hoarding companies like Strategy, have also shifted their hoarding targets to ETH, SOL, and even other altcoins like HYPE.
In addition to the reasons mentioned above, statements from several Federal Reserve officials regarding rate cuts last night also somewhat boosted market sentiment.
Federal Reserve Bank of San Francisco President Daly said last night: "I think there may be two rate cuts, but there is uncertainty in everyone's expectations, considering a rate cut in the fall."
Federal Reserve Governor and potential candidate for the next chairman Waller stated that even if the June employment data is strong, the Fed should still consider a rate cut at the July meeting - "I have clarified my position. The current policy rate is too high, we can discuss lowering the benchmark rate in July... When inflation declines, we do not need to maintain such a tight policy stance; this is the decision-making logic that a central bank should have."
ETH rebounds strongly; can this momentum be sustained?
ETH is undoubtedly the 'brightest star' in this round of market rise. Since the market low in April this year, no one expected that ETH, which was the most pessimistic at that time, would outperform BTC and SOL, achieving a doubling rebound to date.
Regarding the reasons why ETH has recently outperformed the market, we provided a detailed analysis in the article (Five Major Rising Logics Becoming Clear, ETH May Welcome Structural Reversal). In short, supported by five major rising logics, including regulatory easing, institutional accumulation, foundation reforms, growth in on-chain activity, and market confidence returning, ETH, which has experienced a long consolidation period, may welcome a structural reversal and is expected to continue its upward trend in the long term.
Jack Yi, founder of LD Capital, who previously made headlines calling for ETH, this morning also posted on X stating that Ethereum ETH breaking the 3000 USD mark signifies the start of a bull market in the crypto industry... Ethereum is severely undervalued; previous bull markets were driven by ICOs and DeFi, while this round is driven by stablecoins and RWA.
However, regarding short-term trends and the order situation, ETH still faces strong selling pressure around the 3000 USD mark, which means that if it wants to effectively break through this level, ETH may still need to further consolidate and build strength below. CoinDesk's analysis model released this morning also indicates that ETH faces strong resistance around the 3000 USD mark, with the support area located around 2750 USD.
Additionally, the Ethereum Foundation, which was recently praised for its operational reforms, sold 1210 ETH this morning at an average selling price of 2889.5 USD. Considering the past 'topping' record of a certain foundation, this may affect market sentiment to some extent.
Will 'altcoin season' come again?
ETH has always been considered a barometer for altcoins. Previously, the altcoin market had been sluggish due to ETH's long-term lack of performance, but with ETH finally experiencing a strong rebound, market expectations for the legendary "altcoin season" have reignited.
Regarding this discussion, trader degentrading provided a different analysis last night on X, arguing that under the market consensus that 'altcoins are scams', the gradually rising size of short positions will ultimately become fuel for the rise of altcoins due to short squeezes, thereby promoting the arrival of 'altcoin season'.
Currently, an unprecedented phenomenon is emerging in the market: the open interest (OI) of several altcoins exceeds their market capitalization, meaning there are uncovered naked shorts - as short covering requires buying equivalent spot, and when OI > market cap, there simply aren't enough tokens available in the market to support it.
A historic turning point is that as Bitcoin is about to break its previous high, we are observing for the first time: massive funds continuously flowing into ETH; institutions bidding for ETH via treasury companies; altcoin derivatives market open interest hitting historical records; a new generation of traders profiting from shorting altcoins (the consensus of 'after all, altcoins are scams' is prevalent).
A short squeeze storm is about to arrive, with the current total market open interest around 172 billion USD (BTC at 83 billion/ETH at 40 billion), with altcoins alone accounting for 50 billion. When these massive short positions established at historical lows begin to collectively close, this will be the structural source of demand for altcoins. The game is about to begin.
However, differing opinions still exist. DWF Labs Executive Partner Andrei Grachev believes that most altcoins are likely to underperform Bitcoin in the future.
The approval of the "Big and Beautiful Act", the seasonal market activity in the fourth quarter, and potential rate cuts are expected to drive Bitcoin and crypto-related stocks to new highs. The altcoin market may partially follow this upward trend, but most mid-cap coins are expected to underperform Bitcoin, presenting opportunities once again.
It has been too long since the last 'altcoin season', long enough that the term has become a joke, and the market seems to have lost the courage to imagine it again.
Will this time be different?
