Altcoins still aren’t rising despite ETFs... Two things to watch before a “price rebound” [Crypto Briefing]

[Financial News] Unlike Bitcoin, which is showing signs of recovery, altcoins have remained sluggish for the past year. The fallout from last October’s $19 billion (about 25 trillion won) liquidation event appears to be lingering. According to Bitplanet Research Lab on the 28th, Bitcoin’s order-book depth within 1% of its price was about $11.7 million (about 15.5 billion won) on the 7th, up 30% from the start of the year. Order-book depth is the value of buy and sell orders placed around the current price. The greater the amount, the easier it is for the market to absorb price shocks when large orders hit.
Altcoin order books, by contrast, remained thin. The average 1% order-book depth for five assets—Ethereum, Ripple, Solana, Sui and Chainlink—fell 35%, from about $2.6 million (about 3.4 billion won) before the liquidation event to about $1.7 million (about 2.2 billion won) in March this year. Spot trading volume for those assets plus Dogecoin also plunged 60% after the event. Solana’s order-book depth within 2% of its price was down about 29% from the second quarter of last year.
When order books are thin, even small sell orders can cause major price swings. After tariff concerns chilled investor sentiment last October, market makers pulled their buy orders, and positions worth $19 billion (about 25 trillion won) were forcibly liquidated in just 24 hours. Open interest fell 43% in a single day, from $217 billion (about 287 trillion won) to $123 billion (about 163 trillion won). Falling prices triggered forced selling, which in turn pushed prices down further, creating a vicious cycle.
The presence of spot exchange-traded funds (ETFs) did not guarantee price gains. Solana and Ripple, which have spot ETFs listed, returned -15.8% and -27.8%, respectively, this year. Net inflows into spot ETFs for Solana and Ripple totaled $1.4523 billion this year, 2.9 times the amount for Bitcoin ETFs, but ETF funds did not spread across the altcoin market as a whole. This means that even if ETF buying increases, it will not directly bolster prices unless orders waiting on exchange order books also grow.
The real recovery of the altcoin market should be assessed by “order-book depth” and “spot trading volume” rather than prices. Bitplanet said a structural recovery would require both order-book depth and spot trading volume to increase together for two consecutive quarters. It is also important to see whether ETF net inflows spread beyond a handful of assets to a wider range of altcoins.
[email protected] Han Yeong-jun Reporter