- Bitcoin cooled off after nearly touching $123K, with analysts saying the rally looks to be in its early phase rather than at its end.
- Arca’s CIO noted that current altcoin open interest is “nowhere near” the bubble levels seen at previous market tops.
- XRP traded near $2.91, approaching all-time resistance around $3.00.
Bitcoin pulled back from its session highs during U.S. trading on Monday after it nearly reached $123,000 earlier in the day.
Despite the brief cooldown, analysts argue it is premature to declare a market top. The broader crypto rally appears to be in an early stage, and significant regulatory developments unfolding in Washington, D.C., could provide additional momentum.
Rally in its early stage? Assessing market momentum
After a sharp surge of more than 10% in under a week—during which several altcoins rallied even more aggressively—it is reasonable for prices to enter a consolidation phase as traders digest recent moves and take some profits.
Bitcoin dipped below $120,000 late in the U.S. session but still managed a modest 0.6% gain over the past 24 hours.
Other major cryptocurrencies saw deeper pullbacks: Ethereum’s ether (ETH) slipped back below $3,000, while Dogecoin (DOGE), Cardano (ADA) and Stellar (XLM) fell roughly 2%–3% on the day.
Among leading tokens, XRP, SUI and Uniswap’s UNI outperformed, posting gains of about 2.5%, 10% and 6%, respectively.
Crypto-related stocks retraced some of their strong morning gains as well, although MicroStrategy (MSTR) and Galaxy (GLXY) still closed up around 3%–4%, while Coinbase (COIN) rose about 1.5%.
Despite the consolidation, Jeff Dorman, chief investment officer at digital-asset investment firm Arca, argued that this leg of the crypto rally is more likely in an early phase than nearing its end.
In a Monday investor note, he referenced observations by crypto analyst Will Clemente about prior major market peaks—such as the peak tied to the spot Bitcoin ETF in March 2024 and the frenzies around the late-2024/early-2025 election and potential Trump inauguration.
At those peaks, open interest in altcoin derivatives surged dramatically relative to Bitcoin, a common sign of broad speculative excess.
“The current rally is nowhere near that,” Dorman said, suggesting the market has not yet reached an overexuberant state.
He added that while trading volume on both centralized and decentralized exchanges rose about 23% week over week, it remains well below the levels seen during previous broad market rallies.
The bigger picture: sovereign debt and institutional adoption
Looking beyond short-term charts, some observers see Bitcoin’s rise as driven by longer-term, fundamental factors.
Eric Demuth, CEO of European crypto exchange Bitpanda, told TheStreet that excessive sovereign debt and investors seeking protection from monetary inflation are primary drivers.
While he acknowledged that BTC reaching €200,000 ($233,000) is “certainly possible,” Demuth emphasized that the growing institutional and sovereign adoption of the asset is more important than any specific price target.
“What happens when Bitcoin becomes permanently embedded in major investors’ portfolios, in sovereign reserves, and in the global banking infrastructure?” he asked.
Because that is what is happening now.
Demuth expects Bitcoin’s market capitalization to gradually close the gap with gold over coming years; gold is currently valued at more than $22 trillion—roughly nine times the size of Bitcoin’s market cap.
XRP Nears All-Time High, Breakout Looming
While Bitcoin consolidates, XRP has drawn its own headlines.
The token has rallied back toward resistance that sits near the $3.00 level, a price point not seen since its all-time highs.
Trading around $2.91 and up about 2.15% over the past 24 hours, XRP’s move has fueled speculation that a major breakout could be imminent.
“XRP is screaming toward its all-time high,” crypto analyst Ali Martinez wrote recently on the social platform X.
He pointed to a significant technical setup, noting that XRP is now testing the upper boundary of a price channel established over several years, roughly around the $3.00 mark.
A decisive move above this psychological and technical level could trigger a substantial advance toward Martinez’s highlighted target near $4.80.
Confidence in the token’s upside is supported by a notable increase in open interest for XRP derivatives, now totaling about $3.409 billion, which indicates rising trader participation and conviction.
Following the accumulation of leveraged positions—a common precursor to large price moves—overall sentiment for XRP appears bullish.
Further supporting the uptrend, XRP’s price has consistently respected its 10-period adjusted moving average, a sign of healthy momentum and orderly consolidation.
The next few trading sessions will be critical as investors watch to see whether XRP can convert this former resistance into a new long-term support level, potentially launching it into a fresh phase of price discovery.