Explained: Is Altcoin Crash a Buying Opportunity? Which Ones Fell?

Pentoshi, a well-known crypto strategist who correctly predicted the end of the 2021 Bitcoin bull run, explains the mechanisms behind the recent altcoin market crash. Pentoshi, which has 779,400 followers on the X platform, emphasizes that what drives the markets is "momentum". According to Pentoshi, the rapid launch of new altcoins has depleted available capital, causing the momentum to reverse.

Pentoshi explains its expectations for the altcoin market

A crypto strategist known as Pentoshi, who correctly predicted the end of the 2021 Bitcoin bull run, has offered insights into the recent decline in the altcoin market. Pentoshi, which has a significant 779,400 followers on social media platform X, emphasizes the role of momentum in driving market fluctuations. According to Pentoshi, the rapid launch of new altcoins disrupted the market, depleting available capital and causing a change in momentum. He explains:

It becomes a simple supply and demand situation. New coins were being introduced every day, each demanding more liquidity to maintain its value. Eventually the market required daily inflows of approximately $200 million to maintain current prices. With supply exceeding demand and everyone investing heavily, there wasn't enough buffer to prevent these sharp declines. We reached a point of balance and then the bears took control for a while.

This imbalance, combined with widespread “all-in-one” investment strategies, has resulted in passive buying pressure and lack of liquidity. The impact was clearly seen in TOTAL3, a key metric that tracks the combined value of major altcoins. TOTAL3 has fallen from its peak of $788.85 billion in 2024 to $563.85 billion. This reflects a significant decrease of 30%. TOTAL3 is currently trading at $620 billion and investors are closely watching for signs of recovery or a potential retest of the support level. The ones that fell the most among the top 100 by market value are as follows:

### There is optimism about the bull run

Despite the correction, Pentoshi remains optimistic about the overall crypto bull market. “I think this is not the final summit, it is just a local summit. A true bull market ends when supply becomes essentially unlimited and there are no buyers left. “We haven't reached that stage yet.” Encouraging investors, he said, “Good luck and expect excellent buying opportunities in the coming weeks.” Pentoshi offers chart analysis of TOTAL3, suggesting a support level of around $600 billion before a potential recovery and rise towards $1 trillion. It acknowledges the potential risks and highlights:

My perspective may change if Bitcoin loses its market structure or we see significant outflows of Bitcoin from exchange-traded funds (ETFs). Even though these have not happened yet, these are possibilities. The market moves in both directions. For now, this looks like one of the 30% corrections we can expect if history repeats itself.

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