Bitcoin Price has been on the rise and so has its dominance. It has so far broken two key resistances at $8,200 and $8,550, rising as high as $8,700 and now trading at $8,817 according to Coin Market Cap. In the last few days, the dominance has also risen by 2% and analysts see the possibility of it reaching 60% in no time.
According to cryptocurrency analyst, Josh Rager, this may be tolerable, but a rise above this level will be a big step for Bitcoin but most altcoins will not be favoured.
U.S Binance Ban Pushing Users to Bitcoin?
Since the announcement of the ban of U.S traders on Binance exchange in the last 24 hours, Bitcoin has been very bullish, breaking resistances that analysts expected to hold it back.
The altcoins on the other hand have not had so much fun. Altcoins on CoinMarketCap have been in the reds in the last 24 hours in contrast to Bitcoin which has been rising until recently when they also turned green after Bitcoin.
Rager is attributing the sudden price surge as well as increasing dominance to the possible move of U.S traders from trading altcoins into Bitcoin.
The ban was expected to bring a phenomenal growth to Bitcoin because Binance has a large number of carefully selected and in many cases exclusively listed altcoins. The banned U.S traders may not be able to find these altcoins on any other exchange and so a move to Bitcoin might be the next logical thing.
Despite the proposed launch of a U.S version Binance to cushion the effect of the ban, some analysts say this may not provide the kind of variety that is currently available on the main Binance exchange, hence the exodus to the universally available Bitcoin.
Altcoins Could be going Down
If Josh Rager is right, then the movement of traders to Bitcoin has just began and will probably continue until towards when the ban will be enforced. However the falling altcoin market might be a reason for traders to be forced out early, thus worsening the already critical situation.
A reduced dominance for Bitcoin has majorly been the sign of good fortune for altcoins as has been emphasised throughout the market surge in the last month and half. While alts have had their fair share of the market surge with coins such as BSV surging nearly 100%, it seems the season is over.
Every indication in the cryptocurrency space already points to a potential increase in Bitcoin adoption. Just yesterday, Fundstrat encouraged investors to go for Bitcoin as technical indicators suggest the dip season is over.
Already, Rager’s analysis may have caused another level of panic among altcoin holders because of the warning to “Pay attention as increased Bitcoin dominance” as this will spell doom for the altcoin market.
Bitcoin has slowed down a little from its steady surge which started yesterday but could continue a bit later, no way to tell.
If the surge does continue from the current price (and is likely to), broking the last resistance standing between it and $9,000, there could be a real major panic among altcoin traders and the effect may be a severely starved altcoin market.