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Bitcoin’s 2023 High Is $35k, Altcoins ‘Get Wrecked’ If That Happens | Benjamin Cowen

David Lin
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Recent Bitcoin Price Action Signal: Sentiment Towards Bitcoin and Altcoins

Bitcoin’s recent price action has sparked discussions about the sentiment towards Bitcoin and altcoins. In this article, we will analyze the current market conditions and provide insights into the potential implications for both Bitcoin and the altcoin space. We will be joined by Benjamin Cohen, the founder of Into the Cryptoverse, who will share his expertise and analysis on the topic.

Understanding Bitcoin Dominance and its Significance

Bitcoin dominance refers to the percentage of the total cryptocurrency market capitalization that is accounted for by Bitcoin. When Bitcoin dominance increases, it indicates that Bitcoin is outperforming the altcoin market. Conversely, a decrease in Bitcoin dominance suggests that altcoins are gaining traction.

According to Benjamin Cohen, when Bitcoin dominance breaks the range high, it often signals a correction in the Bitcoin market. This pattern has been observed in previous years, where the dominance breaking the range high marked the top or near the top of the Bitcoin rally. Cohen emphasizes that the liquidity from the altcoin market has been fueling the recent Bitcoin rally, but there may come a point where the altcoin market’s liquidity is no longer sufficient to sustain Bitcoin’s valuation.

The Impact of SEC Crackdowns on Altcoins

The recent crackdown by the Securities and Exchange Commission (SEC) on certain altcoins has raised concerns about the future of the altcoin market. Exchanges delisting altcoins and regulatory uncertainty have led to a decrease in liquidity, which is detrimental to the altcoin market. Benjamin Cohen believes that while the SEC narrative may influence price action, the more significant factor is the decrease in liquidity. As liquidity dries up, the altcoin market is one of the first to be affected.

The Rotation of Capital and Evaluation of Altcoins

The rotation of capital from high-risk assets to lower-risk assets has been a significant factor in the recent market dynamics. Benjamin Cohen explains that as liquidity decreases, investors tend to seek relative safety in Bitcoin over altcoins. This rotation of capital has resulted in a decline in altcoin valuations compared to Bitcoin and Ethereum.

Cohen highlights the importance of evaluating altcoins based on their risk-return profile. He utilizes portfolio optimization techniques to determine the optimal allocation of assets. The analysis suggests that Bitcoin and Ethereum remain the safer options, while altcoins present higher risks due to their tendency to bleed against Bitcoin and Ethereum.

The Role of the Macro Environment

The overall macro environment, including equities and other risk assets, can impact the price outlook for Bitcoin. While the macro environment does play a role, Benjamin Cohen emphasizes that Bitcoin operates in a cyclical manner and is influenced by both macro conditions and market cycles. He predicts that a potential downturn in the macro environment, such as an inversion of the yield curve or an increase in unemployment rates, could negatively impact risk assets, including Bitcoin.

Conclusion

In conclusion, the recent Bitcoin price action has provided insights into the sentiment towards Bitcoin and altcoins. The increase in Bitcoin dominance suggests a potential correction in the Bitcoin market, while the decrease in altcoin liquidity raises concerns about the future of the altcoin market. The rotation of capital from high-risk assets to lower-risk assets has impacted altcoin valuations, making Bitcoin and Ethereum relatively safer options. The macro environment also plays a role in Bitcoin’s price outlook, with potential downturns in the macro environment posing risks to risk assets.

Frequently Asked Questions

What is Bitcoin dominance?

Bitcoin dominance refers to the percentage of the total cryptocurrency market capitalization that is accounted for by Bitcoin. It indicates the relative strength and market share of Bitcoin compared to other cryptocurrencies.

Why is the SEC crackdown on altcoins significant?

The SEC crackdown on altcoins has led to exchanges delisting certain altcoins and increased regulatory uncertainty. This has resulted in a decrease in liquidity for altcoins, making it more challenging for investors to trade and invest in these assets.

Why are altcoins considered higher risk compared to Bitcoin and Ethereum?

Altcoins are considered higher risk due to their tendency to bleed against Bitcoin and Ethereum. They often experience significant price volatility and are more susceptible to market downturns. Additionally, altcoins may have lower liquidity and face regulatory challenges, further increasing their risk profile.

How does the macro environment impact Bitcoin’s price outlook?

The macro environment, including factors such as equities and overall market conditions, can influence Bitcoin’s price outlook. Economic downturns, such as an inversion of the yield curve or an increase in unemployment rates, can negatively impact risk assets, including Bitcoin. However, Bitcoin also operates in market cycles, which can influence its price independent of macro conditions.

What is the optimal allocation of assets in the current market?

Based on portfolio optimization techniques, the optimal allocation of assets in the current market suggests a higher percentage allocation to Bitcoin and Ethereum compared to altcoins. This is due to the higher risk associated with altcoins and their tendency to bleed against Bitcoin and Ethereum. However, the optimal allocation may vary depending on individual risk tolerance and investment goals.

Tags altcoinaltcoinsBinancebitcoinbitcoin price predictionbitcoinsbusinessbusiness newsEconomicseconomyEthereumfinancefinance newsfinancial newsHighinvestingmacroeconomicssectradingxrp
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29 Comments

  4. Great guest imo. The liquidity perspective is always relevant. I wonder what happened to the 'value' perspective, the innovation perspective, the blockchain??? 'Right sizing' is where I see the crypto market, and that comes from the question "what is it good for". It's cool to watch it unfold.

  6. Why Bitcoin? You can make any number of crypto's do the exact same thing as Bitcoin under a different name. Nothing rare or scarce about it at all. It's fools gold. Plain and simple.
    Bitcoin has zero value. Don't confuse price with value.
    I thought it was supposed to be a an electronic cash system? A $50 or similar transaction fee lol. It's a total failure. 15 approx years have gone and you still can't buy anything with bitcoin lol

  11. Nice vlog but if Dr Eugene Fama's Efficient Market Hypothesis is correct, all these Chart & Technical analysis is basically useless & it's better to pick 1 or 2 great crypto/asset & use dollar cost averaging.

  17. Ben is a clown always searching for some logical explanation to explain what is an emotional human market.. can't stand this geek.. he doesn't know jack.

  18. It is clear BTC has proved it's use case during this uncertain times. We need more experts like Mr Rolando Eric , who educate people on the evolution of the market so
    people avoid common mistakes. so they don’t walk out of the market feeling frustrated! Keep up the great work! Raised over 24.6 BTC when I started at 2.3 BTC in just few
    weeks implementing Rolando Eric daily trading signals and tips.

  22. Good stuff David. Thank you. Ben's analysis and perspective is grounded and solid. I also appreciate an interview where the host and guest are clearly not checking messages or involved in other things on their PC or phones during the interview. This basic etiquette was lost with remote interviews and needs to be restored.

  23. While BTC is BTC in every cycle, I don't think the altcoin market is ever the same as it was in a previous cycle. Too many projects, too much development, too much variety to just drop them all into one bucket. It's getting more and more serious. ETH becoming a blue chip that everybody acknowledges is an example of that. It also was just another altcoin few cycles ago.

  26. Having Cryptocurrency as an Asset and not been able to profit from them can be very frustrating.
    Is this the right time to invest? Before I jump to the conclusion, I think i should take a look at things first

  27. So on point! we are not in a bull run, just my view. So many You Tubers (high profile ones too) saying we are in a bull run, just crazy.

  28. all this is very interesting. My heart WANTS to believe in BTC but my common sense stops me. My commons sense tells me:
    politicians in democracies and dictatorships do not like BTC because they would lose powes. If for example, the likes of "Senator" Warren have their way they can pass many laws to screw BTC; from banning holding it to using it for trade. If they do that, poof!, BTC dissappears or is drastically marginnalize. Also, governments, particular the abominal regimes like China could be working to hack and destroy or seriously damage BTC. Also, hackers could hack or destroy it with newer technologies.
    Countries could also go to gold backed paper money.
    BTC fans talk about GLD being difficult to transport and governments could confiscate it but both factors illustrate that GLD is always valued.
    Peter Schiff is right BTC has no intrinsic value, nor does paper money, paper money backed by gold or gold itself; all derive from the value people attribute to them. People like gold because os limited supply, nice shine and difficult to destroy.
    My common sense also tells me: "Blackrock likes central control, if they come into the BTC market is to make money trading it or to destroy it, or both at the same time. When BlackRock's Larry Fink, a guy heavily invested in China and who pursues totdl domination of toe industries he invests in, my common sense tells me: "he is like a priest preaching the wonders of sex, he has no credbility on sex or virtue.

  29. Question is……Why does the SEC trying to destroy the alt coin market?
    My take is that they are a threat to the banking and investment markets……
    meaning Wall Street!

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