What to know:
- Bitcoin’s surge above $118,000 signals a potential shift in the crypto market, with traders watching for altcoin momentum.
- Historical patterns suggest that Bitcoin’s new highs could lead to increased liquidity and interest in large-cap altcoins like Ethereum and Solana.
- Analysts note that Ethereum is benefiting from ETF inflows and institutional interest, while Solana and XRP are poised for gains as Bitcoin’s volatility stabilizes.
Bitcoin’s decisive break above $118,000 has activated bullish sentiment in the cryptocurrency markets, with traders closely observing whether altcoins will join in or lag behind in this Bitcoin-led surge.
Historically, when Bitcoin reaches new highs, it serves as a signal to pull sidelined capital back into the market, which often turns its focus toward large-cap altcoins.
Bitcoin Surge
The market is already beginning to see early signs of altcoin momentum, with Ethereum testing year-to-date highs, Solana surpassing the $160 mark, and mid-cap tokens like Shiba Inu (SHIB), Hyperliquid’s (HYPE) and Avalanche’s (AVAX) experiencing substantial gains in the last 24 hours.
“Bitcoin’s break above its all-time high is a liquidity signal that could rotate flows into other major crypto assets,” Rick Maeda, Research Analyst at Presto Research, said in a note to CoinDesk.
“Historically, when BTC sets a new high, it tends to propagate liquidity across the broader market. We’re already seeing signs of capital rotating into large-cap altcoins like ETH, SOL, and XRP, driven by renewed retail momentum and institutional rebalancing. Overall, the BTC breakout marks a regime shift, and we expect altcoin dispersion to rise from here,” Maeda said.
Solana continues to attract attention with its high market volatility and integral narratives. Activity around Solana-related protocols and the latest token launches (notably a surge of memecoins) play a critical role in keeping liquidity flowing.
XRP, driven largely by market sentiment and speculative catalysts, sees renewed interest as traders consider fresh legal insights. With BTC’s volatility cooling off, XRP along with Cardano’s ADA tends to benefit from potential risk rotation.
Ethereum is capitalizing on increased ETF inflows and the broader expectation of institutional reallocating assets. With growing interest in spot ETH products and an uptick in Layer-2 technologies, Ethereum emerges as the most likely leader in this upward movement.
Jeff Mei, COO at BTSE, indicated that “ETH could reclaim $3,200 soon,” noting that SOL “could very well return to the $200 mark.”
“However, it appears that the market overall is experiencing uplifting momentum, with major tokens such as SOL, ETH, and XRP returning to their earlier highs from January,” Mei explained.
Nick Ruck, director at LVRG Research, echoed that sentiment: “As bitcoin hits a new all-time high around $116k, altcoins are gearing up to seize the bullish momentum, and Ethereum ETF inflows are hitting unprecedented volume levels while U.S. regulators eliminate a crypto broker tax rule, enabling DeFi’s further expansion.”
“Other blue-chip coins, including SOL and XRP, seem poised to gain as Bitcoin’s volatility settles and finds a new price support level,” Ruck added.
