After a six-week run, altcoins are cooling off, leading some to fear the worst. However, in a post on X, one crypto analyst urges calm, saying the dip is a normal part of any bull market and may even present opportunities for discerning traders and investors.
Altcoins Drop, Follow Bitcoin
After posting solid gains and rallying to as high as $73,800 on March 13, Bitcoin edged lower on March 14 and continues under pressure when writing. Considering the positive correlation between Bitcoin and altcoins, leading altcoins like Ethereum, XRP, Cardano, and Solana retraced slightly.
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When writing, Ethereum is far from the $4,090 recorded last week. At the same time, the Solana uptrend has slowed, with $200 proving elusive for optimistic traders. Meanwhile, XRP, despite the high optimism when prices roared higher on March 11, is struggling for momentum and is currently trending lower.
While the altcoin has been drawn down, the total crypto market cap drop and fear creep in have caused the analyst to remain bullish. Despite the correction, the altcoin uptrend remains, and most coins, including Ethereum, Solana, and Cardano, could post more gains.
Ethereum, Solana, and BNB Fundamentals Are Solid
To illustrate, the crypto community remains upbeat because of Dencun and its potential to enhance Ethereum and the broader layer-2 ecosystem. Ethereum rollup platforms, including Base and Optimism, that have activated Dencun features have seen decentralized applications (dapps) launching on their platforms benefit.
Uniswap Labs, the team behind Uniswap, a leading decentralized exchange, reported that transaction fees on users trading on Optimism have fallen even further after activating Dencun. This reduction in fees may be a catalyst to drive more activity on-chain, propping up prices.
On the other hand, Solana bulls are upbeat. Since September 2023, SOL has been on a sharp uptrend. At spot rates, the coin roared to register fresh 2024 highs.
With this performance, Solana outperforms Bitcoin and other altcoins, including ETH. CoinMarketCap data shows that SOL has risen by 15% in the past week, closely trailing BNB, the native currency of the BNB Chain ecosystem.
Analysts are looking at the upcoming Firedancer upgrade to fortify Solana’s infrastructure further and increase reliability. Meanwhile, regulatory developments in the United States are evolving positively, propping up altcoins, mainly BNB.
Overall, the crypto uptrend remains even with prices cooling off. More importantly, even with falling prices, sentiment remains bullish. In the past week, CoinMarketCap data shows that the Crypto Fear and Greed Index is at “extreme greed” territory.
Feature image from Shutterstock, chart from TradingView
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