Is The BTC Dominance This Strong?
Whenever markets are strong participants are always of the opinion that somehow they will remain strong. A form of delusion sets in, similar to that of a gambler who always believes that his next effort is going to be the "Big One"! However, this is not the case and is definitely not the case with altcoins at the moment. Once the trend shifted and BTC had once again broken out of a descending channel things became increasingly negative for altcoins in general. Browsing through Coingecko this morning, I can see that even projects like Polkadot are getting hammered!
DOT is down 13% for the day, LINK down a further 13% and even BNB is down 5% after showing significant strength over the past few days. Is this merely a case of investors moving out of alts as BTC regains it's dominant stance or is there something much more powerful at play.
Recent Crackdowns In The Crypto World
Recent Charges by The CTFC against Bitmex, as well as a crackdown in the UK against Crypto derivatives has had no real effect on the BTC price. However alts are getting hammered as investors drop their favorite alts for BTC. In a recent article, I mentioned how the boldness of certain key players in the financial space should be viewed as a move based on information. Technical analysis goes straight out the window when knowledge enters the room. To have knowledge of advancements in a space gives you the absolute cutting edge, hence the criminalization of insider trading.
When observing these crackdowns, the important aspect to take home is the fact that these measures are not against Bitcoin but rather against the tools within the Crypto space that can be used to manipulate the price of BTC. At this point there is no actual attack or "witch hunt" against BTC but rather a "cleanup" within the space. In my opinion the idea that all of this is to pave the way for an ETF is not that far fetched. Many alts are still standing in a grey zone when it comes to regulatory approval and that could influence investors to abandon projects that do not have definitive clarity and move into BTC.
Alts have lost approximately 50% since BTC dumped from the 12K level, which appears to be exaggerated. A $1500 drop in BTC is not much, especially when it is from 12K! However, a 50% drop in alts is rather extreme but perhaps it is further compounded by profit taking as traders and investors saw the altcoin dominance fail.
Either way it appears as if the money is on Bitcoin, at least for now!
