The alternative cryptocurrency (Altcoin) is increasing in value but despite that, Bitcoin is still on top when it comes to the market volume. Though there are various cryptocurrencies that have emerged over the past, it’s no doubt that Bitcoin still has the highest market capitalization.
A lot of DeFi tokens have grown between 5 to 20-fold that resulted in altcoin mania. It can cause the altcoin market to fall if Bitcoin’s price increases in a brief period of time. Profits have the possibility of cycling back from altcoins into stablecoin and Bitcoin. This will leave BTC on its own to rally.
Bitcoin’s high volume in the spot market suggests that real retail investors are accumulating BTC. The majority of altcoins are showing a fresh increase but not as close to BTC’s. This includes digital assets like XRP, Litecoin, EOS, XLM, LINK, BNB, TRX, Bitcoin Cash, and ADA.
Lately, small altcoins and DeFi have dropped to 30% – 60% while BTC’s trading dominance has increased more than their record-breaking $20,000 value in 2017. The monthly volume of Bitcoin to USDT, for instance, exceeded 2,528 million BTC in April 2020 and a monthly volume of 816,000 BTC was registered in January 2018 by Binance.
‘BTC going up swiftly is not only not bullish for alts but it’s bearish. Reasons for this are myriad but boil down to the fact that money is a coordination game and Bitcoin is the Schelling point; this is independent of how you feel about it, the community is literally irrelevant,’ CEO of Three Arrows Capital, Su Zhu said.
Furthermore, a full-time trader at the Amsterdam Stock Exchange, Michael van de Poppe claims that BTC would likely to drop down to $11,100: ‘Still standing behind this view, there’s such a big hurdle coming up for $BTC,’ referring to the chart that predicts $11.1k for a BTC pullback.
Due to the ongoing fight with COVID 19, stores and other companies have adapted the use of cryptocurrencies to lessen personal contact with other people. They are encouraging everyone to lessen the use of fiat money to avoid transferring the virus to others. Cryptocurrency’s popularity is increasing in each use. This doesn’t only help the world of digital assets but also encourages the practice of social distancing and lesser person-to-person contact.