In early June, the crypto market correction erased most of May’s gains within just a few days. Foreign media reported that analyst DonAlt, who gained attention in 2024 for accurately predicting XRP’s surge, believes current market sentiment has fallen to low levels and the trading environment is significantly more complex than in the past.
Erase all previous gains within five days
The report noted that during this June correction, the total market capitalization of the crypto market declined by 15.21% over five days. XRP fell by 16.99%, while Bitcoin dropped by 17.78%.
DonAlt believes that the current market's issue is not just a price correction, but a fundamental shift in how capital is flowing. Previously, the crypto market relied more on sector rotation and risk appetite; now, it is influenced by additional external factors.
Derivatives and ETF interference has increased
According to him, market attention is shifting from the assets themselves to “corporate-level noise.” Traders must now contend not only with price volatility but also with highly leveraged derivatives, an expanding array of ETF products, and the risk of smart contracts being targeted by AI-assisted attacks.
He believes that the past price increases of crypto assets were driven more by market sentiment than by traditional fundamental valuation. With today’s increased external disruptions, it has become significantly harder for retail investors to hold their positions.
Zcash's sharp decline is seen as a risk indicator.
For example, reports noted that Zcash fell 48.4% in a single day after a critical vulnerability in its Orchard pool was discovered. The vulnerability was reportedly identified using the Claude AI assistant.
DonAlt said he would not immediately enter the market following such a sharp decline, as he sees no clear path for the project to regain confidence in the short term after trust in the code has been compromised.
He has not become more optimistic about the overall market. Although some Wall Street funds have begun buying the dip, he stated that he is not willing to take on risk under current conditions. According to him, he will only consider fully resuming purchases if Bitcoin closes the week above $71,000.