On 7th December, a popular Twitterati and a cryptocurrency space influencer who goes by the social media name WhalePanda posted three graphs on his Twitter account. The graph depicted an apt correlation of the two biggest altcoins, XRP and Ethereum [ETH] with Bitcoin [BTC]. Here, WhalePanda also wrote:
“No matter how centralized your coin is, of how many “devs” you have working on your alt… It will always follow the Bitcoin lead.
Bitcoin gives value to all the projects.”
In another tweet, the influencer also wrote about the popular opinion going around regarding the decoupling of altcoins with Bitcoin. WhalePanda propagated that the crypto-members holding such opinion realize their flawed view only when the bear market hits, and subsequently blame BTC from the decline of their respective coins.
“In the bull market altcoiners are talking about “the decoupling” with Bitcoin.
In a bear market they realize they were wrong & blame Bitcoin for the decline in price of their bags.
What they should realize is that Bitcoin is king. If Bitcoin becomes worthless so will their alts.”
After the battle started within the Bitcoin Cash [BCH] ecosystem, the damage splurged around the diameter of the whole cryptocurrency space as Bitmain, one of the biggest mining layers in the industry took a step back in mining Bitcoin. This led to a major crash as all the coins across the board turned red.
During this period, a few key changes in the cryptocurrency ranking took place, one of them being the overtake of Ethereum [ETH] by Ripple’s XRP. Here, XRP showed great potential for decoupling from Bitcoin as it remained the only coin to have pleased the bull amidst a bearish storm.
However, XRP has finally crashed Bitcoin’s after-party and is being assaulted by the bear, as all the other altcoins remain in the red.
On WhalePanda’s tweet, another Twitter user and a cryptocurrency space follower also commented:
“They were not wrong. I think altcoins are de-coupling just fine at the moment…” – DK
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Fall in Bitcoin’s market dominance may be correlated to the fortunes of the altcoin market
The trends set by virtual assets have always highlighted the cryptocurrency market’s inherent volatility and spontaneity. Prices lack symmetry and rarely exhibit consistent growth as different factors come into play to dictate an asset’s valuation.
At press time, the world’s largest crypto, Bitcoin, had stormed past the $11,000 mark and was consolidating to push for a surge over $12,000. The rest of the altcoin market however, apart from one or two minor hikes here and there, has been relatively quiet after collectively surging in the early part of the year.
At the beginning of 2019, a significant number of crypto-assets performed significantly well in a group, wherein most assets demonstrated a prominent hike in their values with little to minor price corrections.
A majority of tokens doubled their valuation until Bitcoin breached the $6,600 resistance. Subsequently, altcoins failed to keep pace as Bitcoin continued to test more resistance limits in the market.
At present time, Bitcoin enjoyed an unprecedented 62 percent dominance in the cryptocurrency market. As its dominance primes itself to climb over the 63 percent mark, many in the community speculate this could be red flags for the altcoin market.
Major cryptocurrency enthusiasts and analysts have stated that altcoins could significantly capitulate if it so happens. However, past events offer a sliver of hope for the altcoin market.
According to CoinMarketCap, the altcoin market has been significantly affected whenever BTC’s dominance has fallen. During the bull run of 2017, Bitcoin enjoyed a dominance of 65 percent and the global market cap hit a value of $402 billion. However, in January 2018, when BTC dominance plummeted, the global market cap peaked at around $710 billion. The dominance was down by half, whereas the global market cap had almost doubled.
A major reason for the same was money funneling into other altcoins after witnessing a shift in momentum from Bitcoin to the rest of the crypto-market. The present market situation may take a similar path once BTC’s dominance falls, opening the door for other virtual assets to take advantage of the scenario.
However, the present rise of BTC is backed by much more certainty than the bull run of 2017. Hence, a repeat of the January 2018 period may be unlikely, and will happen if and only the market sentiment shifts gears drastically towards altcoins.
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