The altcoin season index cooled off, with most coins seen as neutral and only a few showing relative strength.
Altcoin deposits to Binance rose to a one-week high, even as asset prices weakened. The inflows signal a reversal of the altcoin market trend as traders show caution.
Traders are depositing altcoins to Binance, potentially sparking a sell-off. Based on CryptoQuant data, cumulative altcoin inflows into Binance rose to a one-week high, just as price action was weakening for the top 100 assets excluding BTC and stablecoins.
Deposits to Bybit diminished, while Coinbase and other minor markets saw a less steep spike of altcoin inflows.
Altcoin inflows into Binance jumped to levels not seen since November 2024. Similar trader behavior has historically indicated a local market top and a possible drawdown to a lower range.
Altcoin deposits: indicating sell-off or active altcoin market?
The deposits also climbed sharply after months of relatively low activity, with over 45,000 incoming transactions. The rise in deposits happened during the record BTC rally, potentially signaling some altcoin holders were preparing to sell into a strong market. The recent rallies also caused a spike in sales for TRON, as Cryptopolitan previously reported.
Increased deposits signal users are preparing to trade actively instead of holding. At the same time, stablecoin inflows also picked up in July, injecting $2B in USDT into Binance’s markets.
For some, the active altcoin inflows may also indicate the beginning of an altcoin market with more active trading. During the recent market rally, some of the previously inactive coins and tokens still went through sudden pumps.
Another reason was the recent rally of BNB to a new all-time high above $800. Some of the Binance deposits may be driven by the attempt to take profits on the native asset.
Altcoin season index cools off
The altcoin season index cooled off, sliding to 37 points from a recent local high of 43 points. In the past three months, the top 100 assets easily outperformed BTC, often driven by meme token pumps.
Based on the Relative Strength Index (RSI), the bulk of crypto assets are neutral, with no specific direction. Only two assets are considered oversold, with under 10 coins indicating overbuying. During previous altcoin market peaks, more coins were in the overbought category.
A cross-section of the market also includes coins with a stronger direction, mostly made up of Solana narratives. Those include PUMP, ZEREBRO, SLERF, and others. Tokens tied to DeFi also performed better due to the higher liquidity inflows.
The stalling of Ethereum’s rally and the lower positions of BNB and SOL also cut short the expected altcoin market. For now, trading is still relatively active, allowing some of the deposits to be sold with active trading volumes.
Altcoin pairs with BTC are almost inactive, based on Cryptoquant data. In July, altcoin activities against stablecoins increased, while the share of the US dollar also inched up.
The Korean won is one of the sources of liquidity, posting strong buy walls in the past month. The Korean won was behind the Pudgy Penguins (PENGU) rally, as previously reported by Cryptopolitan.
Outside selected outperforming tokens, altcoins are often slow to react, and some assets from previous bull markets have not yet made a comeback or new all-time highs.
Cryptopolitan Academy: Coming Soon – A New Way to Earn Passive Income with DeFi in 2025. Learn More
