Distinguished crypto analyst Benjamin Cowen has noticed a major shift within the cryptocurrency market, with Bitcoin (BTC) reaping the advantages as buyers transfer away from altcoins.
Cowen shared these insights in a video replace launched yesterday, noting a rise in Bitcoin dominance because the crypto market navigates a interval of uncertainty.
Cowen highlighted that even Ethereum (ETH), the second-largest cryptocurrency by market cap, is seeing a relative loss in worth as buyers reallocate funds to Bitcoin. He defined that the illiquid nature of the altcoin market is driving buyers in direction of the relative security of Bitcoin, inflicting its dominance to rise.
“The altcoin market is extremely illiquid, and persons are flocking to the relative security of the blue chips, which sends the dominance of Bitcoin greater,” Cowen mentioned. He additional famous that as Bitcoin’s worth will increase, the altcoin market’s liquidity might now not maintain it, resulting in a possible downturn in altcoin values.
Cowen additionally identified that the present macroeconomic atmosphere makes Bitcoin a extra interesting alternative than altcoins. Amid considerations about an inverted yield curve, excessive inflation, and a extra hawkish Federal Reserve, buyers are searching for the relative security of Bitcoin, which Cowen refers to because the ‘blue chip’ throughout the crypto asset class.
“We primarily have this dynamic the place this liquidity from the decrease liquidity belongings are searching for out the relative security of the upper liquid belongings,” Cowen defined. He added that whereas these exterior the crypto area would possibly scoff at calling Bitcoin a ‘blue chip,’ throughout the crypto asset class, Bitcoin holds that standing.
Because the crypto market continues to navigate unsure occasions, Cowen’s evaluation means that Bitcoin’s place because the ‘blue chip’ crypto might proceed to strengthen.
Featured Picture Credit score: Photograph / illustration by “MichaelWuensch” by way of Pixabay
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