Altcoin Seasonal Index Slips Amid Rising Doubts

The Altcoin Seasonal Index, which measures how altcoins are performing relative to Bitcoin on a scale of 0 to 100, offered early signs of optimism. The index climbed to 59 on Monday, hinting at potential momentum. However, by Friday, it had dropped to 41—reflecting growing uncertainty among investors.

This shift signals that the recent bullish sentiment surrounding altcoins may have been premature or short-lived, especially given the market’s fragile state.

Coinbase Research: Excessive Leverage Behind the Pullback

According to David Duong, Head of Research at Coinbase, the market’s latest downturn has less to do with fundamentals and more with risk management. Since April, the size of the altcoin market—excluding stablecoins—has nearly doubled. But many investors were caught overexposed in highly leveraged long positions.

One key indicator highlighted by Duong is the Altcoin Open Interest Dominance, which rose to 1.6. This metric compares the dollar value of open interest in altcoin futures versus Bitcoin futures. Historically, a spike in this ratio has often preceded sharp market corrections.

Duong emphasized that a drop in this metric would signal healthy deleveraging, while a continued rise could lead to further market volatility.

Bitcoin Dominance Drops Below Key Threshold

A critical factor for the continuation of altcoin momentum is the Bitcoin Dominance metric, which reflects Bitcoin’s share of the overall crypto market. Notably, this figure has dipped below its 200-day moving average—something that hasn’t occurred since January 2025.

According to Duong, “A sustained move below the 200-day average could be the technical confirmation of an altcoin season.” He added that such drops in the past have often preceded weeks-long altcoin rallies, such as in 2021. However, he also cautioned that more daily closes below this level are needed before drawing firm conclusions.

Also, you can freely share your thoughts and comments about the topic in the comment section. Additionally, please follow us on our Telegram, YouTube and Twitter channels for the latest news and updates.

The post Has Altcoin Season Truly Begun? Coinbase Analysts Weigh In appeared first on Coin Engineer.

Significant Decline in Bitcoin Futures!

On-chain analytics platform CryptoQuant revealed in its March 17 “Quicktake” blog post that Bitcoin futures markets have undergone a significant deleveraging event. According to the report, aggregate open interest (OI) dropped by $10 billion between February 20 and March 4.

You Might Be Interested In: Elon Musk Talks About the Name of a New Memecoin!

Bitcoin (BTC) futures open interest had reached an all-time high of $33 billion on January 17, marking unprecedented levels of market leverage. However, following this peak, a sharp decline in risk appetite and the reduction of leveraged positions led to a significant drop in OI.

A Healthy Market Correction Process!

CryptoQuant analyst Darkfost described the decline as a “natural market reset.” According to the analyst, these types of liquidation periods are essential for maintaining the sustainability of an ongoing bullish trend.

Darkfost said, “Currently, Bitcoin futures open interest has decreased by 14% over a 90-day period. Historically, such deleveraging events have provided favorable opportunities in the short to medium term.”

Crypto Market Faces a ‘Demand Crisis’ Warning!

Another CryptoQuant analyst, Kriptolik, pointed out that derivative markets have become increasingly active since November 2024. However, the rise in stablecoin reserves on derivatives exchanges compared to spot markets indicates a lack of genuine demand in the spot market.

Kriptolik stated, “Despite the significant increase in total stablecoin supply since November 2024, the market and investors have not benefited substantially.” The analyst emphasized that the spot market is currently experiencing a “demand crisis.”

He added, “Until this distribution normalizes, avoiding high-leverage (high-risk) trades may be the most prudent approach.”

You can also freely share your thoughts and comments about the topic in the comment section. Additionally, don’t forget to follow us on our Telegram, YouTube, and Twitter channels for the latest news and updates.

The post Record Position Deleted in Bitcoin Futures in Two Weeks! appeared first on Coin Engineer.