A widely followed crypto analyst believes that altcoins are about to take center stage as Bitcoin (BTC) enters a period of consolidation.
Analyst Michaël van de Poppe tells his 684,700 followers on the social media platform X that the approval of spot Bitcoin exchange-traded funds (ETFs) might mean that BTC has already printed a short-term top.
Van de Poppe says while the ETFs are long-term bullish for Bitcoin, it will take time before tens of billions of dollars in capital flow into BTC. For now, the analyst says Bitcoin will likely enter a period of consolidation as deep-pocketed investors rotate their capital and traders wait for a new catalyst.
“However, in the short term, the price of Bitcoin is likely going to consolidate and take a breather. Several reasons for this:
Rotation from GBTC (Grayscale Bitcoin Trust) towards the ETF requires a sell-off on BTC.
Rotation from institutions from spot Bitcoin towards the ETF to be compliant with the regulatory framework.
Hype-based speculants and proprietary trading firms selling their positions (or getting stopped out) on the fact that the hype is over.
The hype itself stops the sudden euphoria of buying the actual asset for now, until there’s a new event.”
As Bitcoin cools off, Van de Poppe believes that altcoins will begin to move. According to the analyst, Bitcoin’s consolidation gives altcoins the time window to rise and outperform BTC.
“The past few months altcoins have been suffering after the sudden strength of Bitcoin, which has rallied from $25,000 to $50,000. Very likely that we’ll be seeing a period of consolidation on Bitcoin and probably a relatively long period of consolidation (three to six months) before new highs are going to occur. In between, altcoin mania and a breakout across the board is the next step.”
The trader also shares a chart suggesting that BTC will consolidate between $39,000 and $50,000 for most of 2024, giving altcoins a lot of time to ignite breakout rallies.
At time of writing, Bitcoin is worth $42,429.
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Featured Image: Shutterstock/thinkhubstudio/Andy Chipus
