Altcoins Rally as Bitcoin Tops $61K and Solana Leads Crypto Market Recovery

Smaller cryptocurrencies outperformed the broader digital asset market as bitcoin climbed above $61,000 and major altcoins extended gains following a stronger risk-on sentiment fueled by easing inflation concerns. The latest crypto rally pushed the CoinDesk 20 Index nearly 5% higher over the past 24 hours, marking its strongest level in a week as every constituent traded in positive territory.

Among the standout performers, Memecore (M) surged 81%, making it the best-performing token among the top 100 cryptocurrencies by market capitalization. Audiera (BEAT) advanced 12%, while Venice Token (VVV) gained 9%, highlighting renewed investor appetite for speculative digital assets.

Bitcoin rose more than 4% to around $61,200, recovering above the key $60,000 level for the first time in a week. Ether (ETH) climbed approximately 5%, while Solana (SOL) jumped 9% after the network introduced an on-chain governance framework requiring users to stake at least 100,000 SOL to submit governance proposals. XRP also posted a solid gain of nearly 4%.

Market analysts attributed the rebound to comments from Federal Reserve Chair Kevin Warsh, who said inflation risks have eased, reducing expectations for an imminent interest-rate hike. Analysts at Marex described the move as the first meaningful recovery from the recent market downturn, noting that improving macroeconomic sentiment has provided stronger support for digital assets. Investors are also closely watching the upcoming U.S. nonfarm payrolls report and President Donald Trump's expected announcement of voluntary AI model standards next week, both of which could influence broader financial markets.

The crypto derivatives market also reflected improving sentiment. Total 24-hour trading volume increased 18% to nearly $200 million, while open interest climbed 4% to $107 million. Liquidations reached $444.6 million, with short positions accounting for the majority, signaling that bearish traders were caught off guard by the market rebound.

Bitcoin futures open interest climbed to 777,870 BTC from approximately 768,000 BTC a day earlier, reaching its highest level since early June. Rising prices accompanied by increasing open interest are generally viewed as confirmation of strengthening bullish momentum. Positive annualized funding rates near 10% and strong cumulative volume delta data further support the improving outlook for bitcoin.

Ethereum and XRP, however, have yet to experience a comparable increase in leveraged demand. ETH futures open interest remained near 13.8 million tokens, while XRP derivatives activity stayed relatively unchanged. Solana futures also cooled slightly, with open interest falling to about 72 million SOL from a record high of more than 76.6 million reached in late June.

Institutional participation remains somewhat cautious. On Binance, the three-month futures basis for both bitcoin and ether continues to trade below the U.S. 10-year Treasury yield of 4.49%, limiting incentives for cash-and-carry arbitrage strategies. Even so, the broader crypto market appears increasingly constructive as buyers become more aggressive.

Market-wide order flow data shows positive open interest-adjusted cumulative volume delta across most leading cryptocurrencies, suggesting buyers are actively lifting offers rather than waiting with passive orders. Meanwhile, 30-day implied volatility for bitcoin and ether has declined after spiking in late June, a pattern that often accompanies rising spot prices.

In separate developments, Ethereum layer-2 network Taiko reopened its cross-chain bridge after suspending operations following a $1.7 million hack on July 22. The restoration followed a multi-stage recovery process that included an independent security audit. Taiko's native token initially surged more than 100% before retreating to around 16 cents, underscoring the heightened volatility that continues to characterize smaller-cap cryptocurrencies despite improving overall market sentiment.