Crypto analyst Axel Adler Jr. says that times of decreased altcoin exchange flow usually indicate massive altcoin price increases. This has been the trend over the entire historical era. Adler says he’s recognized a pretty consistent pattern where reduced exchange volume actually leads to big pump in the altcoin market. His advanced and manifold analysis indicates that today’s market extremes are likely laying the groundwork for yet another rally.
Adler noted that altcoins’ average monthly exchange volume is just $1.6 billion. This figure is dramatically short of the annual $2.5 billion average. Despite increasing attention in the crypto space, the average altcoin exchange flow has remained below the annual average for significant periods, suggesting a possible accumulation phase.
After the tumultuous year of 2022, the crypto market started coming back to life in early 2023. According to Adler, a long consolidation phase created fertile ground for thousands of altcoins. Carrying their momentum from 2020, these altcoins saw phenomenal returns through the first six months of the year. This period of recovery and expansion proved just how quickly altcoins can recover and produce significant gains.
The second half of 2023 brought a return of crypto hype, particularly as excitement about the prospects for Bitcoin ETFs started to build. Yet, during this period of growing attention, average altcoin exchange inflow remained under the yearly average for most of the time. Axel Adler Jr. their view that the smart money was just buying quietly, loading up, setting themselves up for the next leg up.
The trend that's continued from August–Sept 2023 solidifies Adler’s theory even more. Exchange flows decreased drastically during this time. As we moved towards the end of 2023 and into early 2024 we were inundated with another wave of altcoin pumps. That historical precedent, bolstered by the analyst’s contemporaneous observation, made a heck of a lot of sense.
He noted that the reduced exchange activity in the second half of 2023 and August–September 2023 set the stage for subsequent rallies, suggesting a strategic accumulation by investors. In much the same way as early 2023, a low-exchange flowing period started the cycle of prominent alternative coin appreciation.
Adler’s timely warning today finds support in the historical record. Historically, whenever altcoin exchange flow enters extended periods of net outflows, altcoins have tended to explode upwards in price by wide margins. The analyst’s insights come from a close and studious observation of trends in the market as well as historical data.
Adler’s analysis provides some powerful new mental frameworks for investors and general crypto enthusiasts alike trying to navigate the ever-evolving world of altcoins. His insights make the case for keeping watch on exchange flows as forward-looking signals of price direction.
