Altcoin Inflows Fall to $1.6B, Market Eyes Potential Major Rally

Highlights:

• Altcoin monthly flows drop below yearly average to $1.6B
• Similar lows have historically led to strong altcoin rallies
• Bitcoin ETFs see $225M in daily inflows, ETH ETFs lead in net gains

Altcoin flows across exchanges have declined sharply, reaching one of the lowest monthly levels in recent years. The current $1.6 billion monthly average sits below the yearly benchmark of $2.5 billion. Analysts consider this a potential signal for a reversal as past lows preceded major altcoin rallies.

Altcoin Activity Drops While Bitcoin Dominates

According to CryptoQuant data, the average monthly inflow and outflow for altcoins has fallen to $1.6 billion. This figure undercuts the yearly flow line and sits at levels previously seen during periods of accumulation. Historically, similar setups were followed by notable uptrends in altcoin markets.

As altcoin activity cools, Bitcoin dominance has surged to 65.8%, its highest level since early 2021. The chart trend remains within a rising channel and shows no signs of slowing. This level of dominance has historically delayed altcoin rallies by concentrating capital in BTC.

The reduced altcoin flows coincide with a rise in Bitcoin’s price, which remains stable above $100,000. However, this strength appears to be driven largely by futures speculation rather than spot demand. This divergence may eventually shift sentiment back toward undervalued altcoins.

Institutional Flows Concentrated in BTC and ETH ETFs

Meanwhile, ETF data shows institutional investors are still actively adding exposure to BTC and ETH. On June 27, Bitcoin ETFs recorded net inflows of +2,117 BTC, worth approximately $225.9 million. The iShares Bitcoin Trust led with 1,522 BTC added, holding 694,399 BTC in total.

Ethereum ETFs saw stronger inflows, totaling +5,527 ETH worth $13.4 million in a single day. The iShares Ethereum Trust posted the highest net gain of +2,421 ETH. It now holds 1.74 million ETH, confirming strong institutional interest in Ethereum-based exposure.

Despite these flows, some ETH ETFs like Grayscale saw small outflows. The broader picture still shows net accumulation, especially in funds backed by major asset managers. This trend suggests institutions are positioning gradually as market structure evolves.

Futures Volume Points to Speculative Behavior

Furthermore, data from Glassnode reveals that Bitcoin futures volume has remained elevated during recent price increases. 

Unlike the spot market, which has shown flat or declining demand, futures trading suggests a reliance on leverage. Each recent futures spike has been followed by a correction, indicating volatility.

This speculative behaviour contrasts with the subdued altcoin environment, where volumes are at cycle lows. If Bitcoin dominance eases or spot interest increases, altcoins could benefit from renewed capital inflows.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.