The Crypto Market’s Explosive Phase is Just Beginning

• Recent net inflows suggest another crypto rally, potentially mirroring February’s surge.
• Bitcoin’s price increase typically triggers a rise in larger altcoins like Ethereum and Solana.
• With stocks and gold at ATHs, crypto may capitalize on this bullish momentum soon.

The crypto market is heating up, and Uptober is living up to its name with consistent gains. Recent net inflows are similar to February’s boom, suggesting something big is coming. In February, prices surged, and history may repeat itself.

With more money flowing into Bitcoin and altcoins, the market could see another breakout. As Our Crypto Talk points out, external factors are favorable, and if this trend continues, a $100k Bitcoin could be within reach. Altcoins are likely to ride the wave.

Market Inflows Drive the Cycle

Market inflows are behind this surge. When large sums of money enter the cryptocurrency market, Bitcoin usually benefits first. This happens because Bitcoin is seen as the most stable and reliable asset in the crypto space. Increased demand causes upward price movements, which attracts more investors.

Read also : Bitcoin’s Rise Could Mean 10x Gains for These Altcoins

Also, a market where inflows exceed outflows creates a supply squeeze. This basic supply and demand dynamic drives the initial stages of a rally. Investors buy Bitcoin, causing its price to surge. This has traditionally been the first phase of any significant market movement.

Bitcoin’s Gains Lift Altcoins

Once Bitcoin rallies, the focus shifts to larger altcoins. Ethereum, Solana, and Cardano typically benefit first from a Bitcoin-driven rally. These large-cap coins get attention because of their strong market positions and widespread adoption. So, when Bitcoin moves up, these altcoins usually follow.

However, altcoins don’t just follow Bitcoin; they often grow faster. Once Bitcoin stabilizes or slows down, investors want to diversify their portfolios. Large caps like Ethereum and Solana offer that perfect opportunity, driving their prices up in the second phase of the market cycle.

Read also : Related: A Crypto Analyst’s Altcoins Strategy Ahead of the Bull Run

After large-cap coins start to rise, smaller altcoins begin to take off. At this point, investors want higher returns, and small caps can provide them. With lower market capitalizations, these coins can see explosive gains quickly. It’s the most volatile phase of the cycle, but it’s also where the highest profits happen.

Stocks and gold are already at all-time highs, which is good for a crypto rally. If these traditional assets remain strong, crypto will probably follow suit.