A extensively adopted crypto analyst is predicting a meltdown for altcoins as one key metric suggests they’ve a lot additional to drop.
In a brand new video replace, crypto strategist Benjamin Cowen tells his 780,000 subscribers that an altcoin reckoning is on the horizon as a result of the Bitcoin (BTC) dominance chart (BTC.D) nonetheless stays low.
The BTC Dominance chart tracks how a lot of the overall crypto market capitalization belongs to Bitcoin. Based on Cowen, the altcoin market stays a falling knife till BTC.D resolves to the upside.
“One of many issues that [has] stored me actually bearish on the altcoin market is in fact the Bitcoin dominance. [It is] nonetheless very low and now at 42%, when you exclude stablecoins, it’s one thing like 48%…
Although the dominance continues to be low, that is what’s stored me from shopping for altcoins this yr. That is what has stored me from saying in 2022 ‘Look guys, I do know you just like the shiny altcoin objects in a bull market, however in a bear market, they aren’t your mates, don’t marry an altcoin.’
I acknowledge the dominance continues to be low, however I’ll say this metric is basically what’s stored me largely from shopping for altcoins and to this point it’s labored out fairly nicely.”
With altcoins dominating the crypto markets, it means that merchants are nonetheless speculating on digital property apart from Bitcoin.
Utilizing good contract platform Cardano (ADA) for example of a distinguished altcoin that might dip, Cowen notes the crypto asset’s large worth drop over the past yr.
“The idiosyncratic threat of a single altcoin is just not value it, and ADA is now down 92%, however over the last bear market, ADA dropped 98%, nearly 99% from the all-time excessive. It provides you an thought of how dangerous it obtained
If [ADA} were to go down 98.77%, it would go back down to $0.04.”
Bitcoin is changing hands for $16,524 at time of writing while ADA is moving for $0.245.
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