Author: Ciaran Lyons, CoinTelegraph; Compiler: Deng Tong, Golden Finance
A cryptocurrency analyst said that before Bitcoin confirms that it has broken through the $100,000 mark, altcoins will continue to fluctuate between sharp rises and pullbacks.
"We are really looking forward to seeing this strong move, and then we will focus on the rotation of capital," said Pav Hundal, chief analyst at cryptocurrency exchange Swyftx, at Aus Crypto Con 2024.
Altcoins will "remain volatile"
Hundal said that while some "diamonds in the rough" have outperformed Bitcoin, most altcoins, like several meme coins, are likely to "remain volatile" until Bitcoin breaks through the six-digit price level. Previously, Bitcoin almost broke through $100,000, reaching $99,605. As of press time, it is trading at $96,476.
As of this post, Bitcoin is trading at $96,476. Source: TradingView
“I mean, they might see a 20, 30, 40% gain, but the next day they’ll give back most of that,” Hundal said.
On November 21, Solana gained 12.98% in 24 hours, but then fell nearly 13% over the next five days.
Even the major meme coins by market cap are seeing this pattern. On Nov. 15, Pepe surged about 93.15% in just 24 hours after Coinbase and Robinhood announced their listing, only to give back nearly 22% of that gain the next day, according to CoinMarketCap.
When asked if Pepe has the potential to achieve “800% daily gains” like Doge did in the last cycle, Hundal said he “wouldn’t discount that, but when you’re talking about high market caps, you do need inflows.”
“Those kinds of things become more likely when Bitcoin dominance goes back down.”
Bitcoin dominance measures the percentage of the total cryptocurrency market that Bitcoin’s market cap represents.
Hundal believes Bitcoin’s dominance could reach “65% to 67%” and even “70%” before it starts to decline.
“For me, it’s not about trying to pick a PICO for Bitcoin dominance to tell when the altcoin market starts to fall,” Hundal said.
As of press time, Bitcoin’s dominance is 58.30%, according to data from TradingView.
As of press time, Bitcoin’s dominance is 58.30%. Source: TradingView
Anonymous crypto trader Mikybull crypto said in a Nov. 28 post that “Bitcoin dominance will drop sharply starting next month.”
However, CryptoQuant CEO Ki Young Ju recently warned his 374,200 X followers not to expect altcoin season to be like previous cycles.
Ju said this is due to institutional investors driving the current Bitcoin rally, who have little interest in more speculative tokens.
Ju said: "Unlike cryptocurrency exchange users, institutional investors and ETF buyers have no intention of rotating assets from Bitcoin to altcoins."
"In order for altcoins to reach new all-time highs in market capitalization, they will need a large amount of new capital to flow into cryptocurrency exchanges. The altcoin market capitalization below the previous ATH indicates less fresh liquidity from new exchange users," he added.
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