The cryptocurrency market is known for its volatility, and altcoins are no exception. Recently, popular analyst Michael Van De Poppe discussed the current state and future of the market, focusing on altcoins. He noted that the altcoin market is highly volatile, capable of sharp increases as well as major corrections, as seen recently. Major altcoins have fallen by over 40% in the last two weeks, with some on-chain altcoins dropping by more than 70%.

The current correction raises questions about the future of altcoins or if the downward trend will continue. Several factors need to be considered regarding the current correction.

Impact of Ethereum ETF Delay

Poppe explained that altcoins, like Ethereum, are struggling due to uncertainty about when the Ethereum ETF will start trading. Even though the ETF has been approved, it hasn’t been listed yet. This delay is causing confusion and market instability. Once the ETF begins trading, it could bring more investor interest and potentially lead to a market upswing, similar to what happened with previous ETFs.

Macroeconomic Factors

The second argument revolves around recent macroeconomic events such as CPI (Consumer Price Index), PPI (Producer Price Index), and FOMC (Federal Open Market Committee) announcements. These events heavily influence market sentiment and policy decisions, particularly regarding interest rates. CPI and PPI data came in lower than expected, suggesting potential easing of inflationary pressures and potentially signaling future rate cuts by the Federal Reserve (Fed).

Altcoins typically perform well during periods of quantitative easing (QE) and low interest rates when global liquidity increases. However, recent market trends, including a stronger dollar and reduced expectations for rate cuts, have negatively impacted cryptocurrencies, which are considered risk-on assets.

Anticipating Market Reversal

He expects a reversal in the crypto markets, expecting the current downturn to end soon. The key catalyst for this turnaround is the potential listing of the Ethereum ETF, which is likely to generate significant market interest and confidence. Currently, Bitcoin is doing well, but Ethereum and many other altcoins are still far below their highest prices. He says to watch Bitcoin dominance and how Ethereum’s price compares to Bitcoin, as these factors could indicate if altcoins will start doing better.