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(…) the cryptocurrency market periodically switches between overperformance of altcoins (altcoin season) and overperformance of bitcoin (bitcoin season). Historically, when retail traders have observed that bitcoin starts to beat their altcoin holdings, they have not been late in dumping their altcoins for bitcoin instead (…).
Bitcoin Takes Back The Crown As It Prepares For More Gains
Additional data by research and consulting firm Delphi Digital indicates that only 4 cryptocurrencies out of the first 100 listed by CoinGecko have been able to outperform Bitcoin in the daily chart. In the last 2 weeks, only 12 have achieved something similar.Related Reading | Bitcoin Retakes May Highs With Spike In On-Chain Activity, Next Target $60K?
Moreover, the research firm records a pattern in the Bitcoin and Ethereum Open Interest (OI) for their futures. The first and second cryptocurrencies by market cap have been “mirroring each other” since Q3, 2021, until very recently.Since May 2021, crypto-margined futures have been on a multi-month downtrend as cash-margined futures gain a significant share of futures OI. One of the main implications of this is reduced directional convexity.As NewsBTC reported yesterday, there has been an uptick in BTC’s on-chain activity that suggests an increase in institutional participation. The potential approval of a Bitcoin ETF by the U.S. Securities and Exchange Commission could operate as a bullish catalyzer to finally provide the bulls with enough momentum to reach new highs.
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On the contrary, it could also become a “buy the rumor, sell the news” event potentially marking the top of the current cycle. This could be beneficial for the altcoin market, in the mid-term.