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A very interesting thing has been happening lately. As bitcoin makes another attempt at $ 20,000 – a figure it hasn’t seen in nearly three years – the currency’s positive vibes are dying out on other coins, such as Ripple’s Ethereum, Litecoin, Chainlink, and XRP, all of which have increased significantly to press. the weather.
When BTC is good, assets like Ethereum are good
Many people tend to speculate on how well assets relate to each other. The truth is that in the world of cryptocurrencies, all the smaller cryptocurrencies, i.e. Ethereum, Litecoin, etc., tend to follow bitcoin. If the asset rises, others follow suit, and if it falls, altcoins soon find themselves sinking into perdition. It’s just the way things work, so if you’ve invested in altcoins, your best bet is to hope bitcoin works well because most of the time those coins won’t grow on their own.
Well, traders are in luck because, as it happens, bitcoin is doing very well at the time of writing. Despite a recent $ 300 drop in price, the world’s number one cryptocurrency by market cap is still trading for well over $ 15,000 and analysts don’t think this bullish run will end anytime soon. In fact, some are quite confident that the currency could experience its all-time high of $ 20K again.
Alex Kuptsikevich – FX Pro Senior Financial Analyst – explained in a recent interview:
It was important for bitcoin to break through the resistance area near $ 12,000. Once it passed, the coin had no significant hurdles to jump to repeat the rally to $ 20,000. All obstacles have been crushed and now any news background is perceived as positive for the major cryptocurrency.
One of the most important things contributing to the high numbers seen in recent times in cryptocurrencies is the current state of fiat currencies such as the US dollar. As it stands, the USD is having a bit of a problem with inflation and has declined since the coronavirus began to affect our global financial markets.
While some analysts argue that the best thing to do right now is to leave the dollar alone and not print more units to give it time to bounce back, this is not the path the US government is taking. In fact, the country is still printing USD at an extremely fast pace, producing $ 1,200 in stimulus money for all Americans earning less than $ 75,000 annually in late March.
Many figures in the financial sector have assumed this to be a mistake, but the fact is that the problems associated with the dollar seem to be pushing bitcoin into stronger territory.
Is the dollar failing?
John Kramer – trader at market maker GSR – said:
We may not know what post-election stimulus might look like, but investors continue to believe that the U.S. Federal Reserve will continue to print money at a pace that favors limited supply of bitcoin.
