QCP Capital: Bitcoin (BTC) Profits Moving to Large Cap Altcoins Like SOL, BNB, AVAX

Bitcoin (BTC) continues to inch upward while hitting its new all-time high above $73,000 and holding firmly above those levels. However, top Bitcoin holders and whales continue to take profits in this market with capital rotation taking place into large-cap altcoins like Solana (SOL), BNB Coin, Avalanche (AVAX) etc, which have clocked double-digit gains in the last 24 hours.

Bitcoin (BTC) Funding Rate On Decline

Singapore-based cryptocurrency firm QCP Capital provides insights into the current state of the Bitcoin market, as the price of BTC stalls near its recent highs while funding and front-end forwards experience significant declines.

Key observations from QCP Capital’s analysis include a notable decrease in perpetual funding rates, returning to low levels, and March/April futures trading below 30%, with Binance forwards registering lower rates compared to Deribit.

The decline in funding rates prompts questions regarding a potential reversal in leveraged long interest, potentially signaling a downturn in spot prices. However, alternatively, the reduction in leverage levels could pave the way for another upward movement in spot prices.

While the exact outcome remains uncertain, QCP Capital emphasizes the difficulty in sustaining elevated funding rates and anticipates further normalization. As a result, the firm suggests considering selling more spot-forward spreads before rates fully normalize, offering strategic insights for market participants.

QCP Capital’s analysis provides valuable perspectives on Bitcoin’s market dynamics, highlighting the complex interplay between price movements, funding rates, and leverage levels within the cryptocurrency ecosystem. As market participants navigate these dynamics, QCP Capital’s insights offer valuable guidance for informed decision-making in cryptocurrency trading and investment strategies.

Rotation of Capital into Large Cap Altcoins: SOL, BNB, and AVAX

A notable trend in the cryptocurrency market emerges as capital rotates into large-cap altcoins, with significant overnight gains observed in SOL, BNB, and AVAX.

Of particular interest is the remarkable performance of BNB, which has established a self-reinforcing cycle through its launchpool. BNB stakers are observed selling their substantial airdrops and reinvesting the proceeds to acquire additional BNB tokens, effectively compounding returns in anticipation of future launchpool releases.

Notably, this compounding effect occurs on a near-weekly basis, reflecting the frequency of launchpool events. At press time, the BNB coin price is trading at $612 with analysts already giving a prediction for $700.

The observed rotation of capital into large-cap altcoins underscores shifting investor preferences and the dynamic nature of the cryptocurrency market.

🗣️ The top trending tokens in #crypto in the past 24 hours are @avax #Avalanche and @injective #Injective following major price breakouts. Explore the ratio of positive, neutral, and negative sentiment for them, as well as $SOL, $BAN, and other hot assets. https://t.co/l9a2Ewxck1 pic.twitter.com/iXw0x4Ag43

— Santiment (@santimentfeed) March 13, 2024