Altcoin Stars Rise: MNT and HASH Steal Spotlight as Major Cryptos Await U.S. Inflation Data

The cryptocurrency market is buzzing with activity today as investors and traders anticipate the release of the U.S. Consumer Price Index (CPI) report. While major coins like Bitcoin (BTC) hold their breath for the inflation data, smaller altcoins are stealing the spotlight with impressive gains. Notably, Provenance Blockchain’s HASH token has surged by a remarkable 28%, setting the stage for a dynamic shift in market dynamics.

Altcoins Take the Lead

As Bitcoin and other major cryptocurrencies await the crucial CPI data, smaller coins like PUMP, AVAX, and MNT have made significant strides, posting gains of 8% to 11% in the past 24 hours. However, the standout performer is HASH, the native token of the Provenance Blockchain, which has experienced a meteoric rise of 28%.

The surge in HASH’s value comes on the heels of an announcement by the Provenance Blockchain Foundation, which introduced a new model designed to maintain network balance by dynamically adjusting inflation rates based on prevailing conditions. This innovative approach aims to protect stakers from the dilution of their holdings, ensuring that their investments retain value over time.

The foundation explained on the social media platform X, “This approach offers extra rewards and creates a genuine alignment of incentives between users and the blockchain, fostering long-term commitment and healthy network growth.”

CPI Report’s Potential Impact

The upcoming U.S. CPI report is a pivotal moment for the cryptocurrency market. If the data reveals a lower-than-expected inflation rate, it could pave the way for a rate cut by the Federal Reserve, a development that would likely boost cryptocurrency prices further. Analysts at Bitunix noted, “If CPI data is dovish and pushes BTC above this level, it could trigger a short squeeze and accelerate a move into the 115,000+ liquidity zone.”

Conversely, stronger-than-expected inflation could bolster the U.S. Dollar Index (DXY) and delay rate-cut expectations, putting pressure on Bitcoin and other major cryptocurrencies. In such a scenario, the first key support level for BTC is 111,000, with the potential for a retest of the 108,500–109,000 liquidity zone if it breaks.

Derivatives Market: Cautious Optimism

In the derivatives market, open interest (OI) in BTC futures and perpetual futures remains high at 736K BTC, just shy of last month’s record high of 748K BTC. However, trading volume in futures tied to altcoins has remained relatively stable as traders adopt a cautious stance ahead of the CPI report.

Volmex’s one-day BTC implied volatility index fluctuates within a range of 25% to 50%, indicating that the market isn’t anticipating significant volatility from the CPI announcement. Currently, the index stands at 35.50%, suggesting an expected one-day price movement of about 1.85%.

Volatility indices linked to Ethereum (ETH), Solana (SOL), and Ripple (XRP) also remain within their recent ranges, reflecting a market in wait-and-see mode.

Options and Risk Management

Options trading presents a contrasting trend. BTC options OI has surged to over 50,000 BTC, the highest since April, while ETH options OI has increased to 260K ETH, marking its highest level since August 2024. On Deribit, 25-delta risk reversals show a bias toward put options in Bitcoin and Ether, with flows on OTC desk Paradigm leaning bearish. Some traders are hedging their bets by picking up September expiry $4,000 ETH puts.

Mantle (MNT) Shines Bright

Mantle (MNT) has emerged as a star performer in the altcoin space, reaching a record high of $1.62 amid significant trading volume on the derivatives exchange Bybit. MNT, a governance token for its layer-2 network, is gaining traction as investors seek yield on their holdings.

The annualized return of staking MNT on Coinbase stands at a staggering 71%, far surpassing the 1.86% return for staking Ether (ETH) on the same platform. This lucrative staking opportunity has led to more than two-thirds of MNT’s total supply being staked, resulting in a scarcity on exchanges amid surging demand.

Over the past 24 hours, trading volume on Bybit skyrocketed to $195 million, an 83% increase from the previous day. Open interest also climbed by 20%, outpacing the 15% gain in price, as traders opened new leveraged positions in anticipation of further upside. This new record high for MNT could pave the way for other altcoins to rally as well.

The Rise of Altcoin Season

The current market dynamics suggest that we’re entering an “altcoin season,” marked by a shift in trader preference toward more speculative and lower liquidity assets like MNT. The “altcoin season” index rose to 67/100 on Thursday, indicating a growing appetite for altcoins over established crypto majors like BTC and ETH.

As the market awaits the U.S. CPI report, investors are keeping a close eye on the potential impact on cryptocurrency prices. Whether the report will trigger a rally or a pullback remains to be seen, but one thing is certain: the crypto market is as dynamic and unpredictable as ever.