Altcoin sell pressure has reached its deepest level in five years, showing 15 months of steady spot selling, analysts say.
Altcoin sell pressure on Binance has reached its deepest level in years, with Keyrock analysts saying 15 months of steady spot selling show traders still want altcoin volatility in futures but are no longer building the kind of spot bid that powered past altseasons.
In a Monday market overview, Keyrock analysts said they tracked 437 live Binance USDT▲$0.9989 altcoin pairs, excluding Bitcoin, Ethereum, stablecoins as well as wrapped, staked or leveraged tokens.
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The chart measures the running gap between aggressive buying and aggressive selling. When the line falls, sellers are hitting bids harder than buyers are lifting offers.
According to the analysts, net selling dropped to $90.6 billion on June 18, which is $142 million less than the week before and $18 billion lower than the $72.6 billion recorded last June.
The only time the indicator moved above zero was in May 2021, when it reached $3.3 billion near the top of the last altcoin cycle.
Futures Still Active
However, the selling doesn’t mean there have been no trades involving altcoins at all.
According to Keyrock, altcoins comprised 51% of Binance futures volume on June 16, whereas BTC▲$65,218.00 accounted for 28.8% and ETH▲$1,770.64 for 20.2%, implying that there has been a rotation trade from holding spots to trading futures:
“This is a rotation trade, in which we see the spot altcoin bid dying while speculation moves to derivatives.”
Also, the analysts note that some part of the trade shift is due to structural changes in the market, with trading being relocated from centralized crypto exchanges to decentralized ones, perps and off-exchange trades. Despite this, the analysts admit that spot accumulation has “dropped materially.”
Apart from that, the analysts noted Bitcoin dominance around 56.6%, down from 60.66% in May, as well as the ETH/BTC ratio close to its 10-month low. As other researchers, capital “is not rotating into higher-risk assets, but instead consolidating into Bitcoin or moving to the sidelines,” the report reads.
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