With bitcoin up over 16% in the past week and market cap at $ 1.04 trillion, it looks like bitcoin season has begun. However, along with the moderate BTC recoveries, certain altcoins look rather boring.
Additionally, some of the top performing coins from the past month also seem to be struggling to keep up with the market. ADA, SOL and ALGO are the top smart contract platforms after September’s hectic smart contract season also looked boring.
Smart contract season
In particular, SOL, ADA, and even ALGO rallied in August and September, even as BTC and ETH merged. SOL hit a new ATH of $ 215.18 on September 8, while ADA hit a new ATH of $ 3.1 on September 2, and ALGO hit a new 2-year ATH of $ 2.57 post-2019 on September 2 .
During this time, all three enjoyed a high ROI in the short and long term, supported by high trading volumes and lively market sentiment.
ADA, SOL and ALGO Price vs BTC | The source: Sanbase
But that’s not all, the general market rally and the NFT boom played a huge role in this rally. In addition, the ecosystem-oriented development of the platforms and the hype of the community fueled their protests.
For example, ADA’s ATH is due in part to the hype surrounding the release date of the network’s smart contract. Although ADA met ATH before its release date, its value fell shortly thereafter and didn’t gain much momentum after its September 12 release.
However, at the time of writing, all three altcoins have negative ROIs for a day, week and month. But what exactly led to it?
A worrying trend for all three, in addition to consolidating prices, is a sharp decline in the Sharpe ratio. In fact, the Sharpe ratio of ADA and SOL fluctuates in negative territory. SOL’s Sharpe Ratio has been down since its price hit ATH on September 8, and is -1.06 at press time.
The source: Messari
ADA’s Sharpe Ratio hit an all-time low of -3.55 on October 4th but has been on an uptrend since then. On the other hand, ALGO’s Sharpe ratio held up well and reached a value of 3.19.
Additionally, the annual standard deviation of daily rate of return (volatility) for both SOL and ADA is on a steady downtrend, while that of ALGO is down nearly 40% over the past day.
It is noteworthy that in the past 2 months all three altcoins have been on independent tracks and gradually separated from the larger market as prices rose.
Conversely, when the BTC price rose again, these altcoins trended lower. In addition, their circulating market capitalization is being held well despite the consolidation price. Maybe ADA, SOL, ALGO are just waiting for the bigger market to consolidate to take their step.
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According to AMBCrypto