In November 2022, Bitcoin witnessed a remarkable surge of nearly 80% in its market capitalization, soaring to a staggering $28,000 benchmark. The driving force behind this upward trajectory was initiated on March 10, when the Federal Reserve unveiled a fresh liquidity injection strategy to bolster the banking system’s stability.
Despite the recent surge in Bitcoin, many alternative cryptocurrencies are trading at a staggering 90% below their all-time highs. This presents a unique opportunity for traders and investors to explore promising prospects in the coming weeks.
The enigmatic Satoshi Nakamoto’s invention of cryptocurrency was a strategic move to decentralize financial transactions and empower the masses. The genesis of Bitcoin was a direct response to the 2008 Great Financial Crisis, which exposed the vulnerability of the contemporary financial system.
Despite the passage of 15 years, the banking system has once again faltered, with prominent institutions such as Credit Suisse, Silvergate Bank, and Silicon Valley Bank succumbing to bankruptcy. To compound matters, industry experts forecast that an additional 186 American banks may soon encounter comparable challenges. In light of the US government’s inflationary monetary policies, cryptocurrencies present a compelling substitute for traditional bank deposits.
Furthermore, injecting additional liquidity to bail out banks may exacerbate the situation, underscoring the fragility of the fiat financial system. As a result, investors are increasingly turning to gold and Bitcoin as haven assets to preserve their capital. Moreover, the global rally is anticipated to persist.
In cryptocurrency, altcoin prices often play catch-up to the primary digital currency, Bitcoin. This is largely due to investors’ unwavering fixation on Bitcoin, which tends to receive the lion’s share of attention and investment. When news breaks, investors flock to Bitcoin, driving up its value. However, as Bitcoin’s price continues to climb, investors eventually take profits and redirect their funds toward other promising crypto ventures. It’s a dynamic that requires careful attention and strategic planning for those looking to navigate the ever-evolving landscape of digital currencies.
The current market trend favors Bitcoin, as its capitalization is surging ahead of other cryptocurrencies. Between March 10, 2023, and today, Bitcoin has recorded a remarkable 45% growth, while Ethereum has only managed to increase by 31%. The altcoin season index, which ranges from 0 to 100, currently stands at 25. This indicates that altcoin capitalization is poised to surpass Bitcoin in the coming days.
When evaluating the cryptocurrency market, one must recognize the importance of Bitcoin Dominance (BTC.D). The price has recently encountered a formidable resistance level and has demonstrated a discernible response. Should this trend continue, it could signify a shift in the balance of power, with altcoins potentially surpassing Bitcoin in dominance. It is a critical metric to keep a close eye on for any serious investor in the crypto space.
Altcoins, excluding BTC and ETH, have shown promising potential as their prices have broken through the descending trendline and undergone a double test. The current trajectory points towards a resistance zone at approximately $450 billion, with a potential gain of 20%. Should this barrier be surpassed, the market cap may surge toward the $630 billion level, representing a significant 62% increase from the current level. These developments indicate a positive outlook for altcoins and suggest that investors should closely monitor this market.
