It was less than two years ago that Binance accounts were being sold for over one bitcoin. Since the days of “Altseason” many crypto enthusiasts and traders have left the blockchain space to seek less volatile career paths. However, the individuals that remain in crypto have been building and are excited to see the market begin to turn.
Bitcoin (“BTC”) has rallied more than 100% since the start of 2019. Its dominance has increased to its highest level since before 2017 at almost 60%. BTC’s dominance has fluctuated between 39% (at the height of the altseason) to 60% (current position). This means of the total market cap of crypto, 60% of the value is in BTC’s market cap.
With BTC’s dominance reaching an all-time high it is likely we see altcoins return with vigor. It seems many altcoins have already begun their Northern trend in both dollars and Satoshis.
What have the biggest gainers been this prior week?
Binance IEOs
MATIC, FET, BTT, the list goes on and on. Whether you are measuring in USD return or Sat value, Binance IEOs have been on fire recently. Many individuals trust Binance’s preliminary research of projects. This leads to an increased demand for offerings occurring on the largest ‘real’ volume exchange.
Prior bull runs saw other exchanges that have since fallen off, see many of their smaller cap coins explode in value. It is likely Binance will be the focal point of the upcoming bull run. If you haven’t noticed, it is likely to have already started, specifically with Binance IEOs. Unfortunately for U.S. traders there is no access to Binance IEOs until they begin trading. This allows for all IEOs once they begin trading to have a new wave of U.S. based investors looking to scoop up newly launched tokens.
The next bull run will likely push many of the smaller cap projects with working teams on Binance much higher. This trend has already started with BTC’s price and Binance IEOs. The smallest market caps with the biggest developments will be the strongest candidates to see positive price movement.
Volume
Anyone notice the volume of BTC transactions along with many of the alts are approaching their all-time high? Volume is a key factor determining when a bull run is likely to commence. Major volume increases tend to preempt any major moves in the crypto markets. BTC’s price increase from $3900 to where it currently rests were driven by the largest volume seen in years.
With BTC’s volume steadily building for the prior few months it seems many speculators and investors are preparing for May 2020. BTC’s halving occurs in May 2020 which means it becomes exponentially more difficult to create each additional BTC.
BTC Halving
BTC’s halving is officially less than one year away. Following BTC’s halving each additional BTC will be twice as difficult to produce. This means there will be more required electricity, hashing power, time, and costs associated with each individual BTC. As the price to produce a BTC increases while the total supply produced yearly decreases, it is likely one thing occurs: moon.
Economics 101 is fairly simple. If supply decreases while demand remains unchanged, the price increases. If demand increases while supply remains stagnant, price increases. If demand decreases while supply remains stagnant, the price decreases. The current situation BTC is facing is one where the produced annual supply is about to decrease significantly, but the annual demand is growing rapidly. This creates a perfect storm for price.
If demand increases, as a percentage, more than the number of BTC mined, the price of BTC will surge until the demand is brought into equilibrium with the supply. The biggest problem is, no one knows how much demand there will be for BTC.
Could demand coupled with BTC’s halving drive the limited supply to $100,000 per coin?
Yes.
However, it is equally likely another technology comes into existence that supplants BTC’s dominance entirely. Time will tell. Even if the likelihood is 50/50, BTC can and likely will be trading many times higher purely on the speculation of becoming the “world currency.”
Conclusion
The next 365 days are pivotal for BTC as the halving approaches rapidly. It seems Binance will be the exchange to receive the most benefits from renewed interest in crypto and an increase in user adoption. The IEOs of the biggest exchange have already seen great success in their first few months on the market. It is impossible to guarantee what the future will hold, but it is a positive start for Binance’s Launch Pad.
Now that BTC along with many of Binance’s IEOs have seen strong gains look for profits to pivot into many of the smaller caps. Look for surges in volume to help determine which coin is likely to ‘pump’ next.
Unfortunately, I did not take part in any of the Binance IEOs being U.S. based. However, I look forward to watching money pivot to many of the smaller caps.
A few favorite choices for stacking sats and ‘moonshots’ include: BNB, GO, and POLY (will go into further details on why in another article).
It seems Binance and Bitcoin are leading the charge to begin Altseason 2.0. If history is to repeat itself, BTC will have to cool off for a few weeks for the alts to really begin their rallies.
Hopefully your bags are ready, diversified, and remember just because you own 1 BTC of an alt, does not mean you own 1 BTC.
[Disclaimer: This views expressed in this article do not reflect the views of Blockchain Reporter and should not be taken as financial advice.]
To read the Crypto King’s prior articles or to get in contact directly with him, you can on Twitter (@JbtheCryptoKing) or Reddit. The King is the founder of PocketNode, ANON and actively trades cryptocurrencies.
