We’ve seen ups and downs in the crypto market. At one point, we’ve seen Bitcoin go up from $1,000 at the beginning of last year going all the way to near $20,000 in mid-December of last year. However, today, we’ve seen another drop in the price of cryptocurrencies. This time around, Bitcoin was able to stand its ground and maintain stability despite sharp losses in the industry.
The drop has shrunk the value of the digital currency market to as little as $186.2 billion. Looking at the figures, it has been down by more than 75% from its all-time high. At one point, the crypto market had a total of $830 billion and that was just in January of this year.
Why is Bitcoin More Stable?
Unlike other cryptocurrencies, Bitcoin is a bit more stable than the other altcoins despite losses. It is explained by some traders that it has become the safe-haven by many investors. Charles Hayter who is the co-founder and the CEO of CryptoCompare which is a crypto data platform, he thinks that “There seems to be movement to bitcoin as the safe haven in the market”.
As for Marouane Garcon who is the managing director of Amulet which is a crypto-to-crypto derivative platform, “Bitcoin drives the market”. Garcon added that “If Bitcoin isn’t doing well then the alts typically don’t do well”. He also said that “If Bitcoin is doing well then everyone dumps their altcoins and converts to Bitcoin”.
Bitcoin currently stands with a 58% hold of the entire crypto market. It is the highest since December 13, 2017. It is also worth mentioning that Bitcoin only accounted for less than one-third of the total market cap of the digital currency market in January. According to Roger Ver’s prediction last May, he believes that Ethereum would surpass Bitcoin in 2018. But now, it seems that it is far from happening.
Anticipation for a Bitcoin ETF
The market is still anticipating a Bitcoin ETF at this point. In fact, the US Securities and Exchange Commission already suspended two crypto-related products in order to stop confusion that these are ETFs. For many, this is a sign that we could be having a Bitcoin ETF soon.
However, there were recent applications that have been denied by the agency. It includes that of Cameron and Tyler Winklevoss not to mention the nine other Bitcoin ETF applications that suffered the same fate. And the reason by SEC for denying the application is the possibility of price manipulation.
Similar to the Dot-Com Bubble?
Many have compared the crypto market to the dot-com bubble. There are those crypto believers who are saying that this is simply a trial by fire for the crypto market noting similarities in volatility during the early days of big companies. But of course, there really is no guarantee that Bitcoin and other altcoins are going to make it and if the crypto market as a whole is analogous to the dotcom bubble that happened years back. But for now, Bitcoin shows its stability compared to other digital currencies.