Binance Coin BNB Jumps 7%, Leads XRP and Tron in Altcoin Surge - Decrypt

08/20/2024 13:27
Binance Coin BNB Jumps 7%, Leads XRP and Tron in Altcoin Surge - Decrypt

Binance's BNB led the charge with a 7% gain as altcoins saw a resurgence during early European trading hours Tuesday.

The cryptocurrency market witnessed a robust rally as Bitcoin surged past the $61,000 mark, buoyed by strong ETF inflows and renewed institutional interest. 

This bullish momentum has spilled over into major altcoins, with XRP (XRP), Binance Coin (BNB), and Tron (TRX) leading the charge. 

However, the landscape is shifting, prompting experts to recommend new strategies for traders.

XRP has risen approximately 6%, while BNB and TRON have each gained around 7% in the past day, according to CoinGecko data.

The surge in XRP's price comes amid heightened trading activity in its derivatives market. 

Data from CoinGlass reveals that XRP's trading volume has skyrocketed by 57% to $2.23 billion in the past day, while open interest has increased by 11% to $712 million. 

Similarly, BNB has seen a significant uptick in its derivatives market, with a staggering 127% increase in trading volume, reaching $850 million, and open interest rising by 19% to $601 million.

Tron (TRX) has also shown notable growth, with its 6.8% price increase aligning with a resurgence in its futures market. 

Data indicates a significant upward trend in TRX's Open Interest (OI), which has risen from relatively low levels of $50-150 million to approach previous highs around $300 million. 

This increase in OI, occurring alongside TRX's price rise, suggests a bullish market sentiment with traders increasingly entering or maintaining long positions.

Both XRP and BNB have seen substantial liquidations of short positions over the past 12 hours, with XRP recording $668 thousand in liquidated short compared to $233 thousand in long positions, and BNB seeing a little more than $1 million in short liquidations versus just $12 thousand in long positions. 

These figures indicate a strong bullish trend, forcing many traders who bet against these cryptocurrencies to close their positions.

Despite the positive performance of these altcoins, Markus Thielen, CEO of 10X Research, suggested that Bitcoin traders should consider hedging their BTC exposure by taking short positions in altcoin perpetual futures. 

This recommendation comes as Bitcoin's dominance has risen to 56%, while altcoin dominance, excluding Ethereum (ETH) and stablecoins, has plummeted to just 16%.

Thielen noted that this trend, which began in December 2022, suggests a structural bear market for altcoins that could persist for weeks or even months. 

As a result, the traditional buy-and-hold strategy may no longer deliver substantial profits for altcoin investors. 

Instead, this alternative approach of shorting altcoin futures while holding Bitcoin offers traders a way to mitigate risks and capitalize on the evolving market dynamics.

Edited by Stacy Elliott.

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