Altcoin Crash Fears Rise as BTC Divergence Sparks Warning
Crypto analyst Maaturn warn that the altcoin market could face a major crash, citing the growing disparity between open interest in and altcoins.
According to data from Coinalyze, the first warning came five days ago, when the (formerly Twitter) that a significant decline could follow what he described as a fractal pattern.
He noted that BTC’s Open Interest (OI) remained flat at 41.49 at press time, while altcoin OI stood at 69.18. He argued that this divergence in OI suggested altcoin prices were likely to drop.
The chart he presented showed that this pattern had occurred five times between 2024 and now. Notably, the most severe decline came between December 5, 2024, and January 28, 2025—a two-month stretch—closely resembling the current market setup.
Open Interest is a derivative indicator that measures the number of unsettled contracts in the market. High inflows typically signal more liquidity and greater speculation, while low OI suggests a cautious environment.
FinanceFeed also reviewed other metrics to determine whether a broader market fall could be imminent or if conditions remain relatively stable.
Altcoin Season Index Signals Resilience
A study of the Index revealed a sharp rise, providing context to the recent surge in altcoin OI while BTC’s remains flat. The index has climbed to 72, indicating that capital is rotating into altcoins as investor interest shifts.
This surge in OI suggests traders expect a major market swing in the coming days. However, analysis also showed that an altcoin crash is not yet underway. In fact, based on fractal patterns, it still appears distant.
During the December–January crash, the index peaked at 87 while BTC sat at 12. Compared with today’s reading, this suggests altcoins may need to reach similar levels before another crash can materialize.
Market Remains Neutral
CoinMarketCap’s shows the market sitting in a neutral zone, with a reading of 51. Typically, this signals neither aggressive accumulation nor distribution—a calm phase.
For an altcoin crash to occur, the market would likely need to enter the “extremely greedy” zone above 80, a level reached in December 2024 when the last crash unfolded.
In summary, while the divergence between BTC and altcoin OI raises caution, the probability of an imminent crash remains slim. Other key indicators do not yet align with crash conditions, suggesting the market is in a warning phase rather than on the brink of collapse.
