Crypto markets are shifting—and not necessarily in a comforting way. While many investors are celebrating recent gains in altcoins, analysts at Alphractal suggest the current trend could be masking deeper risks.
Their latest report highlights a growing disconnect between altcoins and Bitcoin, noting that these assets are increasingly moving independently rather than following BTC’s lead.
In fact, a correlation heatmap compiled by the firm shows that some altcoins have begun to diverge completely, even moving in the opposite direction of Bitcoin. Historically, this pattern has often preceded sharp spikes in volatility and mass position liquidations.
Alphractal CEO Joao Wedson sees broader implications. He points to Bitcoin’s weakening connection with traditional financial metrics—especially its current negative correlation with the CBOE Volatility Index (VIX), a common measure of investor fear. That break, he argues, could be a sign of explosive price behavior on the horizon.
According to Wedson, when the VIX is low and BTC is acting independently of stock indexes like the S&P 500, the stage is often set for a big move. On the other hand, if volatility in traditional markets surges, Bitcoin could once again find itself under pressure.
In short, while altcoin returns may look attractive now, Alphractal suggests the bigger story may be building quietly beneath the surface—one of divergence, instability, and possibly, a coming shakeout.
Editorial Team
Reporter at Coindoo
Source: https://coindoo.com/market/altcoin-surge-may-signal-trouble-ahead-alphractal-warns/