These are my own opinions and should in no way be considered financial advice.

Is It Over?

Not long ago we had a massive liquidation event and BTC dropped around 15%.  Many alts dropped even further going between 40 - 90% down.  Market sentiment is at a low and many people are saying it's all over and the cycle is now done.  I disagree.  In my opinion, the drop happened because of an accumulation of events, Let's take a closer look.

Pump.fun

Projects like pump.fun are facilitating the launch of Crypto coins like we've never seen before.  There are literally thousands of coins being launched every week.  There is only so much money that comes into Crypto and market saturation like this dilutes the liquidity of other alts.  On top of that the odds are stacked against the end user, insiders of the coins are the ones who get to buy early so have the best chance of making gains, and also the coins can get rugged at any point by the creators.  This leaves people feeling like all of Crypto is a scam.

TRUMP and MELANIA Meme Coins.

Just before his inauguration TRUMP launched a couple of Meme coins.  TRUMP launched on the Friday and ran HARD.  The coin sucked a lot of liquidity from other alts which started the decline.  MELANIA coin dropped on the Sunday and took further liquidity from them.  It was actually quite impressive how much liquidity these coins took from other alts.

Trumps Tariffs.

When President Trump took office, he immediately began to talk about tariffs.  As he was set to impose tariffs on Canada and Mexico a lot of investors in the traditional markets began to sell their stocks as they were concerned about possible trade wars erupting.  The sell off in traditional markets led to a sell off in Bitcoin, which then led to a sell off in alts.

Binance took their chance.

Binance is the biggest derivatives exchange in the market.  They have all the data and know exactly what price they need to get the coins down to, to liquidate the most people and make a lot of money.  While BTC and alts were tumbling Binance took their chance and sold Billions of dollars worth of their Bitcoin, Ethereum and Solana holdings.  This sent the markets down even further and it turned out to be the biggest liquidation event in history with an estimated $12B worth or liquidations in hours.  It's worth noting here that although shady, Binance done nothing illegal as they didn't sell any of their customers coins, only profit that they had been holding in Crypto.

Bitcoin.

So with all this going on, why don't I think it's over for the cycle?  Basically... Bitcoin.  BTC dropped to about $91K but quickly rebounded to around $96K.  It's now currently ranging between $93K-$100K.  On top of that we have constant good news about BTC coming out with countries, companies and now banks all wanting to buy it.

Summary.

In my opinion market sentiment is at a low right now, but it seems to be mainly alt coins that are feeling this pain.  Bitcoin sentiment remains strong, and where Bitcoin goes, alts eventually follow.  It may take a while, but I think confidence in alts will return.

Always DYOR.