Recently, Bitcoin has been pumping a lot. However, majority of altcoins do not share the same optimism. What happened? Let’s analyze

Bitcoin Market Dominance

Bitcoin market dominance is such an interesting topic to discuss. As you can see from the above image (taken from https://coinmarketcap.com/charts), bitcoin market dominance slowly keeps pumping against altcoins. Many people believe the growth of bitcoin market dominance correlates with the bull market. So, what do I think about it? Quite simple.

First, let’s take a look at history and we analyze from there. Our first story began with bitcoin growth from September to December 2016. Bitcoin price grew from ~$570 to ~$968. At the same time, bitcoin dominance grew from ~79% to ~87.6%.

BitcoinGraph 2016

However, in early 2017 until mid-June 2017, bitcoin dominance fell from ~87.61% to ~39.24%. Within the same timeframe, bitcoin price grew from ~$995 to ~$2717

Bitcoin Graph 2017

Then, the second half of 2017 began. This was the most exciting moment of cryptocurrencies (good times!). Bitcoin dominance grew from ~39% to ~66%. It was at the peak of the bull market when bitcoin grew to ~$16500. Well, to be fair, 10 days later bitcoin actually went to ~$19500 (December 17, 2017) but bitcoin dominance already started to fall within this same 10 days.

Bitcoin Graph Second Half 2017

From December 2017 to early January 2018, many altcoins pumped heavily. Coins like TRX and NANO went to their peak valuation at the beginning of 2018. Unfortunately, cryptocurrencies market crashed after the peak of the alt season. The whole of 2018 was a disaster overall. Bitcoin finished the year at ~$3800. Many economists and analysts predicted cryptocurrencies market were already ‘finished’

The good part? Well, in 2019 we have been in a really good year. Bitcoin, especially, grew up a lot in price. Unfortunately, many alts do not really follow bitcoin’s upward movement. Bitcoin market dominance once again pumped to 58.69%.

Where Do We Go From Here?

There are conflicting opinions in the community about this. Some people believe whales will start dumping bitcoin for alts because the market dominance is already very high (close to December 2017 level) while others believe bitcoin will keep rising until bitcoin goes to certain level such as $10000 or even $20000. Of course there are skeptics who believe the opposite, they believe whales will dump bitcoin back to fiat or stablecoin because the recent upward movement was just a bull trap. Nobody knows what will happen and I don’t have any crystal ball.

Personally, I remain bullish and I believe 60-40 rule is the safest option for hodl strategy at the moment. 60-40 rule means 60% bitcoin and 40% altcoins. I diversify some of my alt investments to the top and known coins. Personally, I might change this proportion to more alts and less BTC if things start to look much better for alts.

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