Cryptocurrencies Boom! The Next Bull Run & Cycle Discussion
Bitcoin and cryptocurrencies as a whole have had an excellent past two weeks. Altcoins have performed spectacularly, taking a significant chunk of Bitcoin's dominance. A lot of this comes from smaller altcoins, but plenty of major altcoins are hitting it big too (e.g: EOS).
The general sentiment in the market seems to be much more positive and the decreasing Bitcoin dominance is a sign of risk-on investor behavior. I have mentioned previously that I suspect many investors missed the previous bull run entirely, either due to not knowing about Bitcoin or finding out too late.
This class of investors will most likely drive this run (along with those who did well in the previous run). In terms of whether or not we have moved into an altcoin cycle, it is increasingly seeming like the case. However, Bitcoin dominance fell quite quickly and given the current dominance for smaller altcoins, I think it's possible for a slight rebound in dominance for Bitcoin to around 40% dominance. For now, I'd remain selective on smaller altcoins.
Larger altcoins are still quite behind where they were at their peaks in the previous altcoin cycle (e.g: Ethereum, Ripple, Litecoin), so there might be more opportunities in this group rather than small caps at present time.
I no longer suspect that Bitcoin dominance will rise to 50% (so I'm accepting I was wrong on the peak we'd reach, go ahead and rub it in!). As long as a bull run is in the card, riskier behavior is likely and that means less interest in Bitcoin overall unless it has a major catalyst (e.g: major hard fork like Bitcoin Cash or Segwit2x).
What are your thoughts on the market right now? Do you see us moving into a bull market or is this nothing but a bull trap? Do you prefer Bitcoin or altcoins? Let me know in the comments below. Thank you for watching / reading!
P.S: Video also includes highly requested update on Salt (sold rest of it today) and Polymath (continue to hold despite significant losses against BTC).
Hey @cryptovestor, this might be something you might want to add to your toolbelt: https://www.turtlebc.com/tools/buy_percentage?period=3years
It gives a good idea of Supply vs Demand when it comes to BTC. Would like to have your take on it.
When it comes to bitcoin dominance, I personally don't know what to think of it. To me, it hasn't been a good tool to tell me where I should invest or what kind of cycle we are getting into. What I see is a trend downward over time.
Why I think overtime people are moving into altcoins is because some investors in the space are getting more and more in touch with what certain coins provides in terms of additional benefits....would it be SteemPower, Staking NEO or owning masternodes.
For me, as an investor, staking in SteemPower is ridiculously profitable since I'm literally printing money with my votes(author+curation rewards)...why would I trade that with something like bitcoin at this point? I don't have much incentives to do so other than diversification...but I can buy stocks or more stable assets if I want real diversification.
To add to this view (of BTC dominance declining as a trend), coins like Ether and Gas can be seen as an investment in a commodity that has more value in the future.
Also, some people hold alts through bear markets. Period. Where before people would almost certainly dump most of their alt power into btc in the case of 'uncertainty', now only some of the space does that.
I am also unsure what to make of BTC dominance. @cryptovestor have you ever made a video solely on the advantages of using BTC dominance as a metric? Curious to learn more about it
Before Bitcoin all altcoins were just considered to be shitcoins, which i would have agreed as most were just clones of Bitcoins code and had no use case.
Looking at the history of coinmarketcap in 2015 July 26 there were a lot of useless altcoins and many of them didn't survive to today. Ethereum was considered to be another useless shitcoin and it did have a lot of problems at launch, but now it has major usability for creating ERC20 tokens, which coinmarket cap is filled with (Ethereum was created in 2015 July 30, so the coinmarketcap link is about the day Ethereum launched).
Now if you go to coinmarketcap you can see coins that are actually real, with different use cases (or they try to be). It isn't just 5 coins like before, but probably a few hundred of them which secured partnerships and are aiming to provide for users a new way of payment/utility/securities. Businesses see that there is big potential with blockchain and they want to be part of this new technology.
In 2017 December the altcoin bullrun happened because people found out that there were basically cryptocurrency penny stocks, which meant high risk, but very high reward and started pouring their Bitcoin profits onto ICOs and altcoins. That is why when Bitcoin went down, all altcoins suffered the same fate and were overall very risky. Today altcoins seem to be more resistant, with introduction of upcoming FIAT pairing and numerous other feats. The small cap projects are growing and big players with $$$ are noticing this. Altcoins will start being noticeable to the public and prices will obviously increase, while Bitcoin may fade away because of its old technology and inability to update.
In the end the word altcoins will slowly phase out, because there won't be a huge gap between big boys like Bitcoin, Ethereum, Litecoin compared to NEO, Vechain, IOTA since like before, Ethereum being a shitcoin in 2015, now can't be considered an altcoin. The word "altcoin" may as well be defined as - "not bitcoin".
TL;DR: Just like Ethereum was considered useless at launch, so are most small cap coins, but after a while adoption will rise and more legitimate coins will fill the crypto landscape.
The only problem with your analysis is the scale of bitcoin adoption/ brand and history of security.
Ethereum has a lot of adoption, just look at how many ICOs are launched on ERC20 tokens and how many people use Ethereum for games and other activities. Bitcoin is definitely big, but Ethereum isn't far behind.
Yes security is a problem. The Ethereum team is trying to solve issues about that and i look forward to that. Improvements on Ethereum is a lot faster compared to Bitcoin.
The ALT coin projects are maturing and now launching their projects. They are not just ideas anymore. I am loving NEO, and kicking myself for not buying ZenCash at $15! Oh what two weeks ago? You only need 42 to stake.
42 for a masternode I believe
I dont actually think bitcoin dominance means anything significant at all apart from an indication that either there are more altcoins in the market, or some altcoins are increasing/decreasing in value. To look at it at an even bigger picture, what the hell is the market cap for a currency anyway? what is the "market cap" of the Japanese yen. I'm intrigued by your by percentage tool, so (pardon my ignorance) it shows the percentage of trades thats actually a buy? correct?
we are still not 100% in a bull market
I figured you were most likely right about the BTC dominance coming back to 50+, not because BTC deserves it but simply because this market is young enough that people continue to figure BTC is the only reliable investment, but Im starting to concede that people feel many of the top 100 are "reliable", and secure enough, to justify the risk. Whether that view is appropriate, time will tell.
Even though I doubted alts would surge, stealing dominance from BTC, at this point, I am happy its happening since my portfolio is entirely alt-coin.
So far I've been very lucky, Steem, EOS, IOTA, XRP, Social Send, and TenX have all been big winners so far for me. Again, time will tell whether that growth is sustainable, as you say "in the short term I wouldnt be surprised if BTC made a bounce because some of these alt-coin movements have been a little too quick.
Great video, good content. Polymath seems like a complete joke to me, I know you expressed your thoughts on it, and you felt investing was wise because the masses might buy that non-sense, but seems to me thats not the case, do you have a exit plan on that boat?
Goodluck on Polymath.
p.s. ETHLEND I think is ready to overtake Salt, LEND is actively lending crypto and moving into fiat lending, and they have annoucement after annoucement lately, check them out.
I think eventually 50%+ dominance will occur again, unlike many other people, but don't think it's likely in short-term anymore as I did before. No exit plan on Polymath - if it sinks, it sinks (assuming no catalyst). Unless you mean on the upside - depends on the catalyst. If there is no catalyst and it just waddles back up to breakeven, then I'll probably take a good chunk off the table as that means it is just riding on the coattails of other altcoins. If there is a catalyst, it's a case-by-case basis.
Thank you for mentioning EOS. I am haunted by it, because I looked at EOS in November, when it was at 0,52$ and I didnt bought it. Since then I got more confident in it, that it might be a really fundamentally good project, but waited for a pullback. Check out this great article about it. Just as I started to accumulate EOS in March, it pooped and I stopped buying it. The more it goes up, there more I fear of missing out and come closer to just fucking market buy a shitload of it, just to have peace.
I got great entries to all my projects I am interested (well I just had to wait long enough) in and I mostly buy projects I think are fundamentally sound (not many). But this one I am missing... but your comment got me more confident in sticking to my rules and waiting for a pullback. Any advice on how to best handle this situation and feeling?
Other than that, I think we are already in an Altcoin cycle and mostly smart money has bought up the tokens. There is a good possibility that this bullrun can exceed the one in December and January, because the masses might rejoin, to participate in this run.
But I would be more happy, if we see a more steady growth of the segment, with the good projects leading the pack. And Bitcoin could need more higher price action in my opinion. But I am overall very happy with the market. Thanks for the great video and advice.
I have encountered this problem with ONT and SWH. My strategy was to wait for the first red (1hr, 6hr, or 1d) candle, and buy half position, then wait for days or weeks, buy rest of the half. The first half is the common advice "Never buy at all time highs", and the second part is hedging against more price drops that tend to happen after fast price increases (but this also reduces your potential gain).
I like ONT a lot too, luckily I have good a good entry in that. I am only missing a good EOS entry... and it didnt even dropped today during the BTC pullback...
I would look at AAPL stocks (weekly) during the 2013 drop. Crypto might do the same as adoption slowly grows.
Slow growth is actually really important, so that we can integrate technology properly, so things like Bitcoin $20 transaction fees don't happen. A book called "Slow finance" talks about the importance of slow growth.
Great video. You highlighted the BTC dominance cycle really early, so I was interested in what you had to say now. I think alt coins are gonna outperform for the time being, but I don't think as much as the last run.
The bitcoin dominance figure is really intriguing when looked at on day to day / week to week movement. I think you can see in that figure currently, the rising "other" coins, is starting to make serious gains recently, now being the largest category other than Bitcoin. Given the history of individual coins generally leading this charge as alternates to bitcoin, this is a SERIOUSLY different animal all together as it suggests a wider market net being cast by investors, and a ton of excess market liquidity being dumped into coins people are hoping will pump.
Well, up until now we've been the same players in the market. Whales playing as they please. This year and next will change dramatically with the influx of the big financial players and mainstream. If they choose to invest primarily in bitcoin the dominance will grow fast. But you never know, all I can say is btc is still the king and that wount change any time soon.
Totally agree with your EOS comments for me it is too risky to touch yet.
As for BTC I think it needs to break above 10K to convince me that the market has turned bullish.
Light at the end of the tunnel?