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Is It Altcoin Season Yet? Investors Selling ETH Short Positions and Hodling

Published September 1, 2023 11:04 AM
Omar Elorfaly
Published September 1, 2023 11:04 AM

Key Takeaways

  • Glassnode co-founders predict a bullish season for altcoins.
  • SEC ETF delay pushes altcoin prices.
  • Grayscale legal win helped sentiment.

Negentropic, a co-founder of Glassnode, a blockchain data and intelligence provider, predicted an upcoming surge season for altcoins such as Tether, Binance Coin, Ripple, Cardano, Dogecoin, Solana, Tron, and Polygon.

It based the prediction on the bullish demand for Ethereum, which surged above $1,700 before retracing after an announcement from the US Securities and Exchange Commission (SEC).

Hot Altcoin Summer

According to data from Coingecko , tokens such as DOGE, TRX, TON, and LEO have been on an upward trend all week. 

LEO token on an upward trend
LEO shows signs of success amid market uncertainty

On the other hand, the market exoects a SEC’s response to ETF applications filed by Wall Street giants such as BlackRock and Grayscale.

The uncertainty over ETFs – which may transform the crypto market landscape – leads to market instability and may drive many investors to sell their short positions. Shortsellers showed fears of accumulating future losses.

Data  also shows that “many investors are continuing to sell their short positions, seeing US$4m outflows last week, with the last 18 week run of outflows representing 89% of total AuM.”

The Market Awaits ETF Fate

Investors and other market stakeholders are eagerly awaiting the SEC’s formal response to the BlackRock and Co. ETF applications.

A glimmer of hope was provided after Grayscale won its case against the regulating body. The situation could prompt the SEC to accelerate its response time. Recently, an US District Court ruling found it lacking valid reasoning for rejecting ETF applications.

However, the SEC is buying its time by delaying responses to said ETF applications. The commission postponed responses to mid-October. It synchronized its timeline with the grace period granted by judges for requesting a rehearing of the Grayscale case.

As a result, altcoins gains highlighted in Negentropic’s prediction took a hit, reversing all positive trends due to market uncertainty.

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