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In February 2024, the price of Ripple (XRP) reached its highest point at $0.63. This marked a 30% increase for the month. However, as Bitcoin dominance continues to decline, leading altcoins like XRP have the potential to see even greater gains in March.
Investors are starting to shift their focus towards the altcoin markets, which could result in significant gains for XRP in March 2024. While Bitcoin dominated the crypto headlines in February with various price milestones and record-breaking ETF inflows, market trends at the end of the month showed a growing interest in other crypto sectors.
Bitcoin Dominance (BTC.D) is a chart provided by TradingView that represents Bitcoin’s market capitalization as a percentage of the overall cryptocurrency market. It gives real-time insights into investors’ risk appetite and investment preferences. Since reaching a price of $64,000 on February 28, BTC.D has dropped from 55.2% to 54.3% as of March 1.
During this period, as the price of Bitcoin retreated towards $60,000, altcoin markets experienced significant growth. As shown in the chart, the decline in BTC.D coincided with a $175 billion influx into the altcoin market, resulting in an 8.5% increase in the overall crypto market capitalization.
When Bitcoin’s dominance declines while the crypto market is booming, it indicates that altcoins are gaining prominence. This rare market dynamic demonstrates that as the crypto bull market intensifies, investors are becoming more confident and allocating more capital to the altcoin market.
Notably, XRP traders have increased their leverage by 120% in just three days, indicating a bullish sentiment towards the altcoin. In the past month, all the altcoins in the top 10 rankings, including Ethereum (ETH), BNB, Solana (SOL), and Cardano (ADA), have reached new yearly highs.
Currently trading around the $0.60 mark, XRP needs to surge by 9% to reclaim its previous peak of $0.65, which was last seen on January 2.
Derivatives market trends suggest that speculative traders have been placing more bullish bets on XRP since Bitcoin dominance started to decline on February 28. Santiment’s funding rate trend, which measures the total fees paid between futures contract position holders, has spiked from 0.04% to 0.10% between February 27 and March 1.
Typically, elevated values of favorable funding rates indicate that XRP long position holders are paying high fees to short traders in order to maintain their positions. The last time XRP’s funding rate rose above 0.08% was in August 2023. Such consistent and prolonged spikes in the funding rate occur when leveraged long traders are confident that spot prices will rise in the short term, potentially leading to substantial profits.
If this bullish scenario unfolds, there is a possibility that XRP’s price could reach a new peak above $0.65 in 2024, aligning with the performance of other altcoins in the top 10 market valuation rankings.
