The Money Flow Pattern: Why Bitcoin Leads, Ethereum Follows, and Altcoins Party After

The current market dynamics reveal something significant—it happens that we’re witnessing a capital allocation pattern reminiscent of previous bull cycles. Bitcoin surges, Ethereum accelerates in pursuit, and then liquidity cascades into mainstream assets before rippling across the altcoin spectrum, culminating in meme coin fireworks. This cyclical movement carries deeper meaning: the institutional accumulation phase that began after Bitcoin’s ETF approval in January 2024 appears to be transitioning into a new phase.

Why Institutional Money Changed Everything

During the institutional accumulation period, Bitcoin’s gravitational pull dominated the market. Capital concentrated exclusively on BTC, starving the broader crypto ecosystem of liquidity. Ethereum, altcoins, and even layer-2 solutions suffered from acute capital constraints. What’s unfolding now suggests this scarcity is finally easing—funds are beginning their natural descent through the asset hierarchy.

Reading the Technical Landscape

At $87.54K, Bitcoin continues commanding market attention. Meanwhile, Ethereum at $2.93K appears to be establishing support levels that could define the next phase. The technical picture between 3600 and 4000 remains ambiguous—whether Ethereum breaks through decisively or consolidates within this range will reveal market strength.

The shift in sentiment around these price levels is instructive. At 2600, traders deemed Ethereum expensive and shorted aggressively. Now, if Ethereum retreats to 3600, those same traders rush to go long. This psychological reversal means the market narrative has fundamentally transformed.

From Skepticism to Conviction

In late June, the mad bull market thesis faced widespread skepticism. Few believed, including those analyzing the trends. The Israel-Iran tensions in that period created uncertainty, temporarily disrupting the upward momentum and testing conviction. Yet what appeared to be a major reversal was merely a volatility spike—a valuable reminder that position sizing and risk management trump perfect market calls.

As we advance through this cycle, market consensus will likely shift dramatically. Currently, we remain in the early innings of this bull phase, with participants caught between belief and doubt. Within weeks or months, the conversation will likely invert—few will need to argue for a bull market because the square will overflow with such voices.

The Key Insight

This pattern’s return means it happens that the crypto market is gradually restoring its natural capital distribution hierarchy. The significance lies not in any single prediction, but in recognizing that institutional money, having anchored itself in Bitcoin, is progressively opening channels to other assets. This capital reallocation will ultimately determine whether altcoins and smaller assets participate in the coming move.