- Binance Coin, PancakeSwap, Theta and XRP witnessed a spike in positive sentiment among holders.
- Ethereum Merge could open the floodgates for altcoin season 2022, a massive rally of altcoins.
- The correction in altcoin price charts is similar to the one witnessed in 2018-19 before a double-digit rally in top cryptocurrencies.
Positive sentiment among Binance Coin, PancakeSwap, Theta and XRP holders has increased in light of what could become the new altcoin season. Analysts are predicting massive gains in altcoins, following Ethereum’s lead after the Merge is completed.
Also read: Ethereum price: Chandler Guo, Justin Sun battle Vitalik Buterin to keep ETH POW alive
Ethereum Merge could open floodgates to altcoin season
Ethereum, the largest altcoin in the crypto ecosystem, is heading towards its most anticipated event – the Merge. Ethereum developers announced the final date of the event. The two-part procedure is scheduled to begin on September 9.
The Merge will trigger Ethereum’s transition from proof-of-work to proof-of-stake, a consensus mechanism that is key to the altcoin’s holders and the crypto ecosystem. Despite the uncertainty surrounding the outcome of the Merge and the narratives of a hard fork in Ethereum, analysts believe the event could trigger a massive rally in altcoins. According to the official blog post, the Merge upgrade will be complete by September 20. The two parts of the event will reach completion between September 10 and 20.
The altcoin season is a period where altcoins steadily outperform Bitcoin. While this event does not guarantee profits due to mass volatility, altcoin season is considered the ideal time for traders to diversify their portfolios. The altcoin season index powered by the blockchain center currently reads 94 on a scale of 0 to 100. If the index’s value climbs past 75, it is considered that the altcoin season has started.
Altcoin Season Index from Blockchain Center
Positive sentiment among traders on BNB, Theta, XRP, PancakeSwap
Based on data from crypto intelligence tracker Santiment, holders have a positive sentiment on Binance Coin, Pancake Swap, Theta and XRP. This coincides with the beginning of the altcoin season and implies a price rally in cryptocurrencies likely once the Ethereum Merge is successful.
Santiment uses the metric “weighted sentiment” to score trader sentiment towards a cryptocurrency. This considers the on-chain metrics and social sentiment among crypto traders holding a given asset.
The weighted sentiment is the highest for Tron (TRX), Binance Coin (BNB), PancakeSwap (CAKE), Theta (THETA) and XRP. Check the chart below for one-day and seven-day average sentiment among holders.
Weighted Sentiment of TRX, BNB, CAKE, THETA, XRP
Analysts predict massive altcoin season rally, breakout coming soon?
Analysts at Stockmoney Lizards, a Twitter handle that presents crypto analysis, believe there are several similarities between the current correction in altcoins and previous ones from 2018-2021. These similarities imply that a breakout is in the charts for altcoins in the ongoing cycle.
In the chart below, analysts have highlighted the similarities and predicted a massive uptick in the overall crypto market capitalization.
Comparing total market capitalization 2018-21, 2020-22