Bitcoin (BTC) experienced a sudden flash crash this morning, plummeting over 7% to $66,699 within an hour and a half. However, Daniel Yan, co-founder of Kryptanium Capital, stated that a 5% flash crash is considered “healthy” during a bull market. The significant aspect is that the Bitcoin dominance rate has simultaneously declined for the first time, indicating that altcoin season is approaching.
Bitcoin’s drop began at 9:45 am this morning, falling rapidly from around $71,800 to a low of $66,699 within an hour and a half. As of the time of writing, it has rebounded to $68,117.
This caused other major cryptocurrencies to also experience a synchronized downturn. According to Coinmarketcap data, Ethereum (ETH) briefly dropped from $3,900 to a low of $3,623, a 7% decline. Additionally, mainstream coins such as BNB, XRP, ADA, and DOGE all experienced a 5% to 10% decrease.
Data from Coinglass reveals that within the past 4 hours, the total amount of liquidated positions across the network reached $235 million, with $202 million in long positions and $32.86 million in short positions. The total liquidation amount for Bitcoin alone reached $80.67 million, and for Ethereum, it amounted to $36.92 million.
Amidst the market crash, Daniel Yan, co-founder of Kryptanium Capital, tweeted that a 5% flash crash is normal during a bull market. What is surprising is the simultaneous decline in Bitcoin’s dominance rate, which has dropped from over 55% a few days ago to 53.27%.
Earlier, Daniel Yan tweeted on the 11th, stating that he believes altcoin season will arrive after Bitcoin significantly breaks its new high. In the previous bull market cycle, altcoin season occurred due to the Bitcoin halving narrative and institutional capital inflow, which led to a continued rise in Bitcoin’s price before the halving. However, after the halving, traders took profit from halving trades, resulting in more potential gains for altcoins.
This situation is similar to the current one, where the current cycle is driven by ETF fund inflows, also propelled by institutional demand. Yan argues that altcoin season should begin around mid-April, coinciding with the Bitcoin halving event.
Yan stated that for most altcoins, reaching new highs is still far off, which creates an attractive psychological appeal for investors. The new high for Bitcoin confirms that the cryptocurrency market is in a bull market frenzy, and people’s greed will become intense. However, it is important to be cautious of short-term bull traps.