The ongoing rally of Bitcoin BTC/USD, Ethereum ETH/USD and Solana SOL/USD should not lead investors to believe that all cryptocurrencies will do equally well in a bull run, a new report found.
What Happened: “Any coin or token that failed to rally at least 10% over the last week should likely be avoided,” the 10x Research analysts write in their latest report, urging investors to stay focused on selective assets that demonstrate resilience and growth potential.
For instance, Solana proxies Jito JTO/USD and Jupiter JUP/USD outperformed with weekly gains of 24% and 16%, aligning with SOL-USDT's strong performance.
Ethereum proxies have also seen significant gains, with Ethena ENA/USD achieving a 37% increase.
Despite Ethereum not being the central focus in this rally, 10x Research points to signs of a possible bottom, supported by weekly stochastics indicators.
“The day when BlackRock's marketing team launches an Ethereum ETF push is drawing closer,” the report adds, suggesting a potential boost to Ethereum's standing as interest in ETFs grows.
The report highlights the convergence of crypto with traditional finance, predicting that regulatory developments in the U.S. could further stimulate institutional interest in cryptocurrencies.
Ethereum, already the largest decentralized smart contract platform, is well-positioned to continue driving use cases with greater regulatory clarity.
The report notes that Ethereum's appeal will be bolstered by lower gas fees following the anticipated Dencun upgrade in March 2024, potentially attracting more network validators and staking participants.
Also Read: The Trump Effect: A Deep Dive Into How The Crypto Landscape Will Change In 2025 And Beyond
The Bitcoin Uptrend: Bitcoin's market movements are also noteworthy. Bitcoin ETFs have recorded $1.4 billion in inflows, bringing the total inflows to over $25 billion this year.
This trend indicates genuine buying interest, with Bitcoin spot ETFs alone seeing $5.1 billion in inflows. Low funding rates suggest this influx is largely from long-only buyers, leading to a potential squeeze in Bitcoin.
The demand for calls over puts on Bitcoin reflects strong bullish sentiment.
“Bitcoin Skew, the spread between implied volatility for puts versus calls, continues to fall, reflecting stronger demand for upside exposure over concerns about downside risk,” the report states.
Bitcoin's volatility dynamics could shift as spot ETFs gain prominence, possibly leading investors toward higher-beta cryptocurrencies like Ethereum.
Meanwhile, the report identifies an uptick in retail trading activity in South Korea, with tokens like UXLINK UXLINK/USD seeing substantial trading volume.
As the token outpaced popular cryptocurrencies such as Dogecoin DOGE/USD and Bitcoin on Korean exchanges, it reflects a renewed interest among retail traders and adds a layer of volatility to the market landscape.
This rally is unfolding amid institutional inflows and increased interest in core cryptocurrencies.
10x Research suggests that as institutional mandates expand, attention will likely consolidate around major cryptocurrencies, notably Bitcoin, Ethereum and Solana.
These assets are not only leading the market but are also positioned to drive the crypto market cap to new highs.
What’s Next: For further exploration of these trends and strategies, Benzinga's Future of Digital Assets event on Nov. 19 will bring together industry leaders to discuss the future of cryptocurrency investments amidst regulatory shifts and market changes.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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