The cryptocurrency markets are booming this morning and altcoins like MATIC, AVAX, DOT, Solana and others are leading this rally. The global crypto market cap breached the $1 trillion mark fuelled by the altcoin gaining spree.
What are altcoins?
All cryptocurrencies besides Bitcoin are known as altcoins. Altcoins use unique consensus mechanisms to validate transactions and create new blocks, unlike Bitcoin’s Proof of Work protocol. For example, Solana uses Proof of History protocol, whereas Cardano uses Proof of Stake protocol and so on.
How are altcoins performing?
According to CoinMarketCap, altcoins are on a gaining spree, with many tokens showing double-digit uptrend. Ethereum rose by 13.52 per cent and is trading at $1,538 whereas Solana recovered by a significant 10.24 per cent. Polygon’s MATIC gained 20.55 per cent. AVAX token of Avalanche blockchain network boomed 10.23 per cent.
Three reasons for the altcoin boom
Bitcoin gains
Bitcoin’s rebound above $22,000 has given tailwinds to altcoins which has, in surpassed the average growth rate of Bitcoin itself. Crypto markets commentator Sharat Chandra told Business Today, “Altcoins such as Matic have outperformed Bitcoin by more than 18 per cent over the last 24 hours.”
Whales load up on altcoins
A crypto whale is a person or an entity that holds a significant quantity of cryptocurrencies. Investors have the ability to influence the markets. Data from Etherscan revealed that such investors are loading up on altcoins like Shiba Inu, MATIC, AVAX, and others while causing a significant hike in the values of these cryptocurrencies.
Positive forecast by analysts
Analysts and traders have forecasted a positive outlook on altcoins based on technical and fundamental analysis. Chandra stressed this point by saying, “Technical indicators for altcoins like ETH signal that an immediate bull run is in the offing.”
Also Read: Why is MATIC on a gaining spree? 5 reasons – BusinessToday