Surge in On-Chain Real-World Perp Volume, Altcoin Rout: Intensifying Polarization in the Cryptocurrency Market

The cryptocurrency market is currently exhibiting a stark polarization. On-chain real-world perp volume is surging, while most altcoins are plummeting, dampening investor sentiment. This trend is further amplifying market volatility, necessitating a cautious approach. Utilizing FireMarkets’ analysis tools can aid in understanding key market dynamics and formulating investment strategies.

Intensifying Polarization in the Cryptocurrency Market: Background and Causes

According to CoinTelegraph’s report, the cryptocurrency market is currently characterized by two key features: a surge in on-chain real-world perp volume and a plunge in most altcoins. This is not merely a temporary phenomenon but rather a reflection of changes in the market structure itself. This polarization is the result of a combination of factors.

Causes of the Surge in Real-World Perp Volume

Real-world perps are derivative products used in the cryptocurrency futures market that enable leveraged trading based on real assets. The recent surge in trading volume is attributable to the following factors:

• High Leverage Utilization: Real-world perps offer high leverage, allowing investors to pursue significant returns with relatively small capital.


• Increased Institutional Investor Participation: With the increasing participation of institutional investors in the cryptocurrency market, leveraged trading through real-world perps has become more active.


• Market Volatility Expansion: As overall market volatility expands, the expectation of earning larger profits through leveraged trading has increased.

Causes of the Plunge in Altcoins

Conversely, most altcoins have experienced a plunge, dampening investor sentiment. This is related to the following factors:

Worsening Macroeconomic Indicators

With the global economic situation becoming unstable, investors are hesitating to invest in risky assets such as cryptocurrencies. In particular, with rising interest rates and inflation concerns persisting, investors are showing a tendency to shift capital to safe assets.

Disappointing Results from Major Projects

Recent disappointing results from several major cryptocurrency projects have eroded investor confidence, negatively impacting the entire altcoin market.

Market Sentiment Weakening

As overall market sentiment weakens, investors are cutting their exposure to altcoins, securing profits through sell-offs, and reducing their investments in risky assets.