Crypto crisis: Geopolitics hits Bitcoin, altcoins on the brink!

Crypto crisis: Geopolitics hits Bitcoin, altcoins on the brink!

The current geopolitical tensions in the Middle East are having a negative impact on the crypto market, such as wallstreet-online.de reported. Bitcoin is recording a slight decline, while many altcoins are suffering noticeable losses. Despite these challenges, the overarching narrative remains intact: Bitcoin is still seen as a solid foundation. Experts emphasize that altcoins theoretically offer opportunities for diversification and higher risk exposure.

There is optimism about a possible altcoin season in 2025. This market phase denotes a time when alternative cryptocurrencies perform better than Bitcoin. It is expected that the approval of new crypto ETFs could act as a catalyst for such a rally. Crypto analyst Ran Neuner predicts a massive altcoin rally in the summer of 2025, which could be triggered by the expected approval of altcoin ETFs, particularly a Solana ETF.

Market dynamics and ETF approvals

The US Securities and Exchange Commission (SEC) requests adjustments to S1 filings, indicating impending approvals. Bloomberg ETF expert Eric Balchunas estimates the chance of a Solana ETF being approved at an impressive 90 percent. Solana ETFs could mobilize fresh capital – estimated to be up to $2.6 billion in the next six months. Notably, the SEC requires specific disclosures regarding the treatment of staking, and Solana ETFs could be the first with direct staking integration. Returns of over 7 percent annually from staking are difficult to achieve in traditional markets.

Current interest is also focused on protocols such as Jito, Sanctum and Kamino, which could potentially benefit from the ETF staking trend. Analysts expect that other altcoins such as XRP or Sui will soon receive ETF approvals. Altcoin ETFs could therefore lead to new market dynamics in the summer of 2025.

Shift in the investment landscape

highlights that Bitcoin exchange-traded products (ETPs) could change the concept of “altseason” in the crypto market. Historically, the market has experienced cycles where Bitcoin saw a surge, which attracted capital and then flowed into altcoins. However, the market has seen record inflows of $129 billion into spot Bitcoin ETFs in 2024, making Bitcoin much easier to access for both individual and institutional investors.

Institutional investors are increasingly favoring ETFs to gain regulated access to cryptocurrencies as they can avoid the risk associated with altcoins. This shift in investment preferences is also evident in the record outflow of $2.4 billion from altcoin investments in February.

The look forward

The current “Altcoin Season Index” is below 25, indicating Bitcoin dominance and signaling countercyclical entry opportunities. Analyst Ufo Calls expects that interest rate cuts could lead to market changes and daily altcoin gains of 20 to 30 percent could soon be realistic. Amid these developments, Telegram-based trading bot Snorter, which raised $900,000 in the presale phase, is optimizing trading features directly in the chat. The SNORT token, which exists on Solana and Ethereum, reduces transaction fees and offers staking at over 320 percent APY.

Given the growing number of altcoins, over 40 million, and the 1.2 million new tokens being launched monthly in 2024, it is crucial to keep an eye on future market developments. However, experts warn that most altcoins may not survive unless the market fundamentally changes.