Altcoins will swing between big rallies and pullbacks until Bitcoin confirms a breakout past the $100,000 mark, according to a crypto analyst.
“We’re really waiting to see that exuberant move, and then we’ll look at that rotation of capital,” crypto exchange Swyftx lead analyst Pav Hundal told Cointelegraph at Aus Crypto Con 2024.
Altcoins will ‘remain choppy’
“I mean, they might see a 20%, 30%, 40% gain, but then it’ll retrace most of that move the next day,” Hundal said.
“These sorts of things become more possible when Bitcoin dominance is coming back to the downside.”
Bitcoin dominance measures Bitcoin’s market capitalization as a percentage of the total crypto market.
Bitcoin dominance is key
Hundal said that Bitcoin dominance might reach the 65% to 67% range, even “up to the 70%” range, before it starts to decline.
“For me, it’s not a case of trying to pick the PICO top of Bitcoin dominance as to when the altcoin market is going to start coming down,” Hundal said.
Ju said this is due to institutional investors with little interest in speculative tokens driving the current Bitcoin rally.
“Unlike crypto exchange users, institutional investors and ETF buyers have no intention of rotating their assets from Bitcoin to altcoins,” Ju said.
“For altcoins to reach a new all-time high market capitalization, they will require a significant influx of fresh capital to crypto exchanges. The altcoin market cap below its previous ATH indicates reduced fresh liquidity from new exchange users,” he said.
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