• David Duong, Head of Institutional Research at major crypto exchange Coinbase, argued that while bitcoin and ethereum remain the top coins, altcoins still draw interest from institutional investors.
• He noted that 55% of flows on Coinbase are directed to BTC and ETH, but the remainder is still on altcoin.
• The current market conditions are macro-focused, with people investing their bonus payments in 401(k)s and waiting for tax season checks.

Altcoin Markets Draw Institutional Investors

Coinbase Exec David Duong argued that altcoins are still attracting significant interest from institutional investors despite Bitcoin and Ethereum dominating the market. He noted that while 55% of flows on Coinbase directed towards BTC and ETH, the remainder is still being invested into altcoins.

Macro Conditions Neutral

Duong believes that what we’re currently witnessing in the market is a lot more macro-focused, as people are investing their bonus payments into 401(k)s ahead of tax season checks. He concluded that overall macro conditions for risk assets including crypto are neutral at this time.

Mini-Narratives Quicker Bubbles

Scott Melker further commented that mini-narratives related to altcoins appear to be much smaller and quicker bubbles compared to those seen in the past. He suggested that these may be caused by crypto native people quickly moving in and out of altcoin narratives without new money being invested.

Debt Ceiling Issues Ahead

Duong warned though that in Q2 2021, debt ceiling issues could arise which could potentially weaken the economy further. He recommends keeping an eye out for such developments when it comes to assessing the performance of risk assets including cryptocurrencies going forward.

Conclusion

Altcoins remain an attractive option for institutional investors despite Bitcoin and Ethereum’s dominance over the market according to Coinbase’s Head of Institutional Research David Duong. While current macro conditions remain neutral ahead of tax season checks being cut, investors should keep an eye out for debt ceiling issues later this year which could affect how risk assets including cryptocurrencies perform going forward