Altcoin leverage has swelled to unprecedented levels, setting the stage for violent swings if momentum cracks, according to a July 23 report by Glassnode.

The report highlighted that the combined futures open interest across Ethereum (ETH), Solana (SOL), XRP, and Dogecoin (DOGE) increased from $26 billion at the start of July to $44 billion, representing a 69% surge. 

Daily increases have stayed above the two‑standard‑deviation mark for 12 straight sessions, the longest run on record, suggesting that traders are aggressively piling into leveraged bets.

Notably, that positioning is getting expensive. Long-side futures traders have paid roughly $32.9 million in cumulative funding over the past month, nearing the $42 million tab seen around Bitcoin’s March peak and still below the $70 million blow‑off in late 2024. 

Elevated funding signals conviction, but it also means a crowded trade that can unwind quickly if prices stall or reverse.

Rotating capital

Speculation is rotating away from Bitcoin (BTC). Ethereum’s share of aggregate open interest has climbed to 38% against Bitcoin’s 62%, its highest reading since April 2023, with only 5% of days printing a larger ETH share. 

Perpetual volume has tilted even further. Ethereum has just overtaken Bitcoin in volume dominance for the first time since the 2022 cycle low, marking the largest skew toward ETH on record. 

The report noted that this shift reflects traders seeking higher beta as Bitcoin cools after a surge to an all-time high earlier this month, a move that pushed its realized capitalization above $1 trillion for the first time before price action settled below the peak. 

Bitcoin still accounts for more than 64% of total crypto market value, a concentration that could cap altcoin momentum if BTC weakens.

Altcoins show considerable weekly growth

Glassnode’s Altseason Indicator flipped positive on July 9 and has stayed there, triggered by concurrent inflows to Bitcoin and Ethereum, rising stablecoin supply, and a momentum crossover in aggregate altcoin market cap.

Altcoins added $216 billion in value over the last two weeks, one of the largest dollar gains on record. 

Yet, sector correlations show that most altcoins are moving in lockstep with each other while decoupling from Bitcoin, a pattern that often leaves the complex system vulnerable to fragility. 

When leverage is stretched and assets trade as a single block, even modest shocks can cascade through forced liquidations.

The report framed the setup plainly, stating that the altcoin rally is real, but traders buying the upside should be prepared for high incoming volatility leading to significant downside.

Mentioned in this article

MicroStrategy recently revealed that they had acquired an additional 3,000 BTC this month, bringing its Bitcoin holdings to 193,000 BTC. Interestingly, BTC’s recent price surge caused these holdings to cross the $10 billion mark, with the software company currently sitting on a tremendous amount of unrealized profits. 

MicroStrategy’s Unrealized Profit Reaches $5 Billion

As disclosed in the company’s filing with the Securities and Exchange Commission (SEC), its BTC holdings have now been purchased for an average price of $31,544. That means that MicroStrategy’s Bitcoin investment is now at an unrealized profit of almost $5 billion, considering Bitcoin is trading just above $57,000. 

MicroStrategy’s ‘Bitcoin strategy,’ spearheaded by its co-founder Michael Saylor, began as far back as 2020 when the company started investing in the flagship crypto token. Saylor saw this as a way to hedge against inflation and diversify the company’s cash reserves. Since then, Saylor and his company have continued to accumulate Bitcoin aggressively. 

Saylor’s faith in Bitcoin was tested when the company’s investment was at an unrealized loss during the height of the crypto winter when BTC traded below the $30,000 price level. Despite that, Saylor and MicroStrategy stayed true to their Bitcoin Strategy. Instead of selling, they saw it as an opportunity to accumulate more BTC.

Saylor also recently made it clear that he and his company have no intention of liquidating their BTC holdings anytime soon, stating that “Bitcoin is the exit strategy.” This sentiment undoubtedly provides a bullish narrative for the flagship crypto, especially considering what could happen to the market if the company offloads its Bitcoin. 

MicroStrategy is currently the largest corporate holder of BTC and is leading the charge as institutional demand for BTC continues to increase. This demand has mainly come from the Spot Bitcoin ETFs, which together hold more BTC than MicroStrategy combined. 

Spot Bitcoin ETFs Trading Volume Surpass $2 Billion Again

Bloomberg analyst Eric Balchunas revealed that the newly listed Bitcoin ETFs once again surpassed the $2 billion mark on February 27. This was the second consecutive day they achieved this, having recorded an all-time high of $2.4 billion in trading volume on February 26. Specifically, the world’s largest asset manager, BlackRock, seems to be having a run of its own. 

Balchunas noted that BlackRock had broken its record again, with the iShares Bitcoin ETF (IBIT) recording a trading volume of $1.3 billion on February 27. The impressive demand for these funds is believed to be another reason why BTC’s price has continued to rally. 

At the time of writing, Bitcoin is trading at around $57,100, up in the last 24 hours, according to data from CoinMarketCap.  

BTC adds over $2,000 in six hours | Source: BTCUSD on Tradingview.com

Featured image from Milk Road, chart from Tradingview.com

Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

Institutional investors had been showing bearish sentiment towards Ethereum for the longest time. The second-largest cryptocurrency by market cap, which had initially caught their attention, was not doing as well as expected, and the outflows that followed were massive. However, it looks like sentiment among these large investors is beginning to turn positive as Ethereum has begun to record inflows.

Ethereum Inflows Balloons

Over the last several weeks, Ethereum inflows have been ramping up. Although they were nowhere near the volumes that had been recorded during the bull market, it had put a stop to more than 2 months of consecutive outflows for the digital asset.

Last week would prove to be no different, given that Ethereum’s inflows had come out to $8 million, a low volume, but it was inflows nonetheless. But the most important inflows were recorded in the week prior when the digital asset had initially been recorded to have seen inflows of $2.5 million.

Related Reading | More Than 57,000 Traders Liquidated As Bitcoin Declines Below $22,000

Corrected numbers which had emerged this week had shown that not only was this number too low, it was off by more than $100 million. When the corrected data was published this week, it showed that inflows into ETH had reached $120 million in that single-week period, meaning that it was the largest single-week inflow in one year.

It is a testament to the changing sentiment among institutional investors when it comes to the altcoin. With the anticipated Merge approaching quickly, the bullish sentiment has washed over both small and large investors alike, prompting more investment into the digital asset.

A Week Of Inflows

Ethereum was fortunately not the only cryptocurrency to mark another week of inflows. The bullish sentiment had extended to almost every sphere of the crypto market, and the investors had reacted accordingly. So from bitcoin to digital asset investment products, the inflows continued.

Related Reading | Ethereum Weekly Exchange Net Flow Points To Growing Accumulation Trend

Bitcoin had seen either week of inflows, with $16 million recorded for last week. Just like Ethereum, the numbers for bitcoin for the prior week had been incorrect, and corrected data showed a much higher inflow rate for the prior week with $206 million in total. The inflow trend was not limited to long bitcoin alone, though as short bitcoin continued its streak with $0.6 million in inflows.

Digital asset investment products would prove to be the big winners for the week with inflows of $27 million. The total asset under management has not been pushed back up to $30 billion with last week’s inflows. Europe also accounted for the majority of inflows as Switzerland alone recorded $16 million for last week. The USA and Germany would see lesser inflows of $9 million and $5 million.

What this data shows is how investors are looking toward the market with the recent recovery. However, given the recent decline in prices, it remains unsure whether the inflows will continue for the new week.

Featured image from News Text Area, chart from TradingView.com

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The waiting list for Robinhood Markets Inc’s (NASDAQ:HOOD) “WenWallets” that can be used to store, buy and sell Dogecoin (CRYPTO: DOGE) has swelled to 2 million.

What Happened: The revelation of the upsurge in interest in the cryptocurrency wallets was made on Twitter by Christine Brown, Robinhood’s chief operating officer for Cryptocurrencies.

I’m thrilled to share that we’ve officially reached *2 million* on our https://t.co/csw9dmh85z waitlist!  The Beta program has rolled out to 13,000 customers too as of today, beating our previous estimates!

— Christine (Hall) Brown (@christine_hall) February 3, 2022

The beta wallet has been rolled out to 13,000 customers as of Thursday, which also beats the company’s previous estimates, Brown said. 

The Robinhood executive acknowledged in a separate tweet that customers want the trading platform to roll through the waitlist quickly, but said Robinhood must review data to manage fraud risk and protect customers as “moving on-chain presents new risks.”

We hear our customers who want us to roll quickly through the waitlist, but we must carefully review data to manage fraud risk and protect our customers as moving on-chain presents new risks, especially for our customers connecting with the blockchain for the first time.

— Christine (Hall) Brown (@christine_hall) February 3, 2022

Brown said that customers will see slight delays in transfers to the blockchain due to “additional security reviews.”

During Beta, customers will see slight delays in transfers being submitted to the blockchain due to additional security reviews. As we move to launch, these will be reduced, and ultimately be a seamless experience (a small % of transactions will go through additional checks).

— Christine (Hall) Brown (@christine_hall) February 3, 2022

“As we move to launch, these will be reduced, and ultimately be a seamless experience (a small % of transactions will go through additional checks),” she said. 

See Also: How To Buy Dogecoin (DOGE)

Why It Matters: In November, Brown announced the first alpha transfer of DOGE from a Robinhood wallet to an external wallet. DOGE co-creator Billy Markus described the development as “huge.”

Robinhood supports buying and selling of a number of cryptocurrencies like Bitcoin, Bitcoin Cash, Litecoin, Ethereum and Ethereum Classic.

Cryptocurrency enthusiasts had been pushing Robinhood to introduce cryptocurrency wallets and used the phrase “not your keys, not your Bitcoin” to drive home the point.

In September, Robinhood teased the enthusiasts by providing an update on the rollout and first used the term “Wen Wallets?”

HOOD Price Action: Robinhood shares were trading 7.68% higiher at $15.24 midday Friday. 

Read Next: Ethereum, Other Crypto Stakers, Miners Rejoice — The IRS Will Not Tax Unsold Tokens After All