Analyst Announced: The Altcoin Era is Stuck in This Development!

Benjamin Cowen, one of the analysts closely followed in the cryptocurrency markets, states that investors should wait a while longer. According to Cowen, the US Federal Reserve (Fed) may need to reduce interest rates for the altcoin era to begin. Here are the details…

The analyst announced the development he expected for the altcoin period

A widely followed crypto analyst says investors should not wait out the altcoin era until the Fed makes its next move. Addressing 802,000 YouTube subscribers with a new video, Cowen reminded that a similar situation occurred in the previous cycle. Stating that altcoins left Bitcoin (BTC) behind only after the Fed started to cut interest rates, the analyst also draws attention to technical analysis information:

Many altcoins are actually falling right now. There are more fallers than risers. Therefore the rise/fall index is falling again. The same situation happened in 2019, just before the Fed cut interest rates. The index fell very quickly at that time, and of course the Fed started to reduce interest rates in July. Therefore, this is a point that needs to be followed closely. Many people talk about the altcoin era and that altcoins will have superiority over Bitcoin in the long run, but we reached this stage in the previous cycle after the Fed started to cut interest rates.

Rising expectation in Bitcoin dominance

Cowen predicts that altcoins will lose value against Bitcoin until the Fed makes a new move. According to analyst assumptions, Bitcoin’s market dominance could rise up to 60%. He continues his explanation as follows:

I think altcoins will continue to lose value towards the crypto ruler. I wonder if Bitcoin’s dominance will increase significantly over the next few months as liquidity continues to drain from the altcoin market.

As of the date of writing, Bitcoin’s market dominance stands at 55.39%. The total cryptocurrency market value excluding Bitcoin (TOTAL2) is around 1.049 trillion dollars. These assumptions of Cowen may cause concern for altcoin investors. However, as the analyst emphasizes, when past cycles are taken as a reference, macro-economic breakthroughs such as the Fed’s interest rate cut can significantly affect the crypto markets. It may be useful for investors to act cautiously at this point and follow market dynamics closely.

What happens when Bitcoin dominance increases?

When Bitcoin dominance rises, as the analyst expects, it means that the market cap of Bitcoin is increasing compared to the total market cap of all cryptocurrency markets. This may indicate that investors are avoiding risk and turning to safer havens. The rise of Bitcoin dominance could have several different effects:

• Pressure on altcoins: As Bitcoin dominance increases, investors tend to shift their funds to Bitcoin, which may cause the prices of altcoins to fall.
• Market stability: Bitcoin is considered the most mature and liquid asset in the cryptocurrency market. Therefore, when Bitcoin dominance increases, this may indicate greater stability in the market.
• Bull and bear markets: Bitcoin dominance can also be used to identify bull and bear markets. Generally, Bitcoin dominance decreases in bull markets and increases in bear markets.