Popular crypto analyst Nicholas Merten has made a prediction about the altcoin market. According to Merten’s recent DataDash update, he anticipates a significant decline in the altcoin market cap, primarily influenced by the plummeting value of memecoin Pepe (PEPE).
Merten highlights that the current state of the altcoin market lacks any significant catalyst to attract increased liquidity. To support his prediction about the ongoing decline in altcoin market liquidity, Merten dives into the recent price movements of three layer-2 scaling solution projects: Optimism (OP), Arbitrum (ARB), and Polygon (MATIC).
By analyzing the price action of these projects, Merten says that there is a continued drain of liquidity from the altcoin market. Merten also says that Pepe is a telltale sign that the altcoin market is weakening.
“And if Pepe wasn’t the sign here for you guys. I don’t know what is. If the only thing that is getting people excited in this period of time is a memecoin, which has been dumping here over the past couple of days. This is just abysmal for the industry. Speculation does not do well in contractionary environments,” he added.
In contrast to Merten’s perspective, crypto analyst Michael van de Poppe holds a different view, especially with the upcoming Bitcoin halving event. Van de Poppe believes that now is the right time to accumulate alternative coins or altcoins.
According to his analysis, the Bitcoin halving can potentially lead to increased liquidity flow into altcoins as investors seek opportunities beyond the dominant cryptocurrencies.
He wrote, “For altcoins, the time to accumulate them has come. One year before the halving -> time to buy those positions. Reached an important level here, which is also approx. 1 year before the halving.”