Despite Major Altcoins Including Ethereum Plunging Over 10%, Long-term Upside Expectations

Recent surge in ETF listing applications

Heightens expectations for an altcoin price rebound

"This plunge is only a temporary readjustment

After adjustment, the possibility of a price rebound is high"

Cryptocurrency prices, which had been repeatedly rising amid fears that tariff conflicts between the United States and China could flare up again, have turned into a decline. Experts forecast that cryptocurrency price volatility could increase for the time being. However, they expect the long-term upward trend to continue.

According to CoinMarketCap on the 12th, the price of Bitcoin plunged on the 11th and at one point during the session fell below $110,000. Ethereum's price also broke the $4,000 level and at one point fell into the $3,500 range. Other major altcoins such as XRP and Solana also fell more than 10% in a single day. Some altcoins collapsed more than 90%. On the 11th alone, approximately $50 billion (about 71.7 trillion won) of total cryptocurrency market capitalization evaporated.

The sudden price drop also triggered large-scale liquidations. According to market data analytics firm CoinGlass, more than $19 billion (about 27 trillion won) worth of cryptocurrency was forcibly liquidated on the 11th alone. This was the largest ever, more than ten times the liquidations during the COVID-19 pandemic ($1.2 billion) and the bankruptcy of FTX, the world's third-largest cryptocurrency exchange ($1.6 billion).

In response to the sudden market changes, Alternative's Crypto Fear & Greed Index also fell to 27, classified as 'fear', on the 11th. The index had been at 64, classified as 'greed', just the day before on the 10th.

Despite the sharp price drops, experts say the upward momentum of altcoins has not been broken from a long-term perspective. Cryptocurrency analyst Benjamin Cowen said, "The market has undergone a large correction, but there are not yet technical signals that the bullish phase has ended," adding, "Ethereum still has the capacity to set a new all-time high." Cryptocurrency analytics firm Swissblock also predicted, "The shock from large-scale selling will act as a precursor to the next upward movement."

The recent surge in altcoin exchange-traded fund (ETF) listing applications in the United States is also forming expectations for an altcoin price rebound. Earlier this month, 21 applications for new cryptocurrency ETF listings were submitted to the U.S. Securities and Exchange Commission (SEC). Besides those ETFs, the SEC must decide this month whether to approve the listings of 16 cryptocurrency ETFs including Solana, XRP (formerly Ripple), and Litecoin. Although federal government operations, including the SEC, have been temporarily suspended due to a recent shutdown, there is considerable speculation that altcoin ETFs will be approved.

Jamie Kutz, Real Vision's senior cryptocurrency analyst, said, "The macro trend of the exponential spread of blockchain infrastructure and the 'debasement trade' is unchanged," diagnosing, "This plunge is not 'game over' but merely a temporary risk readjustment." Tom Lee, chairman of Bitmain, the world's largest Ethereum-holding company, also said, "The market's structural bullish factors remain," adding, "This plunge is a healthy correction process and there is a high possibility that altcoin prices will rebound within a week."

Kang Min-seung, Bloomingbit reporter minriver@bloomingbit.io