Altseason Odds: What’s Causing the Crypto Decline Today and When Will New ATHs Occur?
What is causing the latest crypto downturn today? We were all hopeful that the approval for rate cuts by Fed Chair Jerome Powell during last week’s Jackson Hole meeting would bring us relief. Clearly, that isn’t the case.
The crypto asset market has suffered the loss of nearly $20 billion in value over the past 72 hours, with Bitcoin alone accounting for about $10 billion of that decline. Analysts suggest this drop underscores the fact that this phase is heavily BTC-driven, despite gaining momentum altcoins from August still drawing speculative investments.
Bitcoin’s dominance (Bitcoin.D) has dipped to 57%, marking its lowest level in months, as traders turn toward high-risk altcoins. Yet even with BTC’s decrease, altcoin crypto market capitalizations have also seen declines.
Data from TOTAL2, which excludes BTC, shows similar decreases, indicating a lack of genuine rotational interest. The market seems to be in a holding pattern; the pressing question is when altcoins will finally recover?
What is Causing Crypto to Drop Again? Alternative coin Open Interest Hits a Stunning $61.7B
While spot trading remains subdued, Altcoin Futures Open Interest (OI) surged by +$9.2 billion on August 22, reaching a record high of $61.7 billion. According to Glassnode data, non-BTC crypto OI has grown by nearly $40 billion since March, vastly exceeding Bitcoin’s OI increase of $30 billion in the same timeframe.
The mechanisms at play give off the impression of an overextended derivatives trading market where Bitcoin’s declines exacerbate losses for altcoins.
Ethereum’s value dropped nearly 7%, hitting a low of $4,313 before stabilization. Meanwhile, the Alternative coin Season Index fell from 61 to 56 in just one day, evoking memories of previous correction indicators.
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ETH, Non-BTC crypto Season Index, and Historical Warning Signs: Should There Be Concern?
As per Decentralized finance Llama, the overall Decentralized finance market’s TVL is approximately $95 billion, down from its peak in 2025. Leverage is multiplying amidst declining prices. Funding rates on Binance, OKX, and Bybit remain positive, indicating that aggressive long positions persist, despite weak price performance.
CoinGlass illustrates the imbalanced nature of the current setup:
- Altcoin OI has risen 18% this week.
- Spot activity remains stagnant. In three days, $1.1 billion was liquidated, primarily driven by ETH, SOL, and AVAX.
The scenario suggests vulnerability rather than stability.
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BitMine Takes Advantage of the Dip, Speculating on Ethereum Rebound: What’s Next for the Crypto Markets?
A key player is already asserting that we are at the bottom. Tom Lee from Fundstrat has predicted that Ethereum will “hit the bottom in the next few hours,” highlighting favorable risk/reward levels close to $4,300.
Supporting this forecast, BitMine Immersion Technologies acquired 4,871 Ethereum ($21.3 million), raising its total holdings to 1.72 million Ethereum, valued at about $7.5 billion. This solidifies BitMine’s standing as the second-largest Ethereum treasury after Michael Saylor’s Strategy.
With leverage extended, Bitcoin’s dominance declining, and altcoin OI reaching all-time highs, traders are at a critical juncture. It’s possible that rotational flows may trigger an altseason, or the trading market could face another wave of liquidation, dragging everything down further. Until then, price swings appears to be the prevailing situation.
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Key Highlights
- What is causing the digital currency crypto market to crash again? We had all anticipated that the green light for rate cuts from Fed Chair Jerome Powell would pave the way forward.
- Tom Lee from Fundstrat forecasts that ETH will “reach its lowest point in the coming hours,” with promising risk/reward ratios near $4,300.
The article Altseason Odds: Reasons Behind Today’s Crypto Crash and Predictions for New ATHs was first published on 99Bitcoins.
