Just thought I would take the time to explain how this coming month may look.
Many people, new to the space, are rightfully questioning their decision to get involved in investing. I remember I was the same when I first began and went through my first crash. I saw my portfolio drop by 27% in an hour and within 3 days by 62%. Alarm bells were ringing and I thought I would lose it all. Of course that wasn’t the case and turned out to be quite the opposite just weeks later when I was sitting at a 211% profit on my original investment. So here is what I wish somebody had shown me.
Bitcoin dominance or BTC Dominance as it is displayed on the top of the coinmarketcap.com page is an important indicator. It allows us to see the total value of Bitcoin compared to all the other cryptocurrencies in the market.
As you will see below, at the time of writing this article, BTC Dominance is at 61.3%. The highest I have seen this year.
What does all this mean? Well, when we had finished the BCH (Bitcoin Cash) fork, Bitcoin dominance dropped to around 46% and the market had grown in cap size by 27%. That’s a significant movement.
By using the above numbers, let us assume more conservative estimates for the coming fork. Lets assume the following a) The BTC dominance remains at 50% b) The market grows only by 20% in market cap.
This means that BTC would hold 50% of the market cap at 225 billion, or 112.5 billion. As stated, these are conservative, but should illustrate our point well.
Currently BTC has a market value of $115,089,501,000 therefore the price wouldn’t need to drop significantly and may still trade around the $6900 range. However the alt coin market which will receive an injection of funds from the ‘free Segwit2x’ money would rise from its current level of approximately $73,581,812,000 to 112.5 billion. This represents a 53% rise in value of alts in a few weeks from now.
However, being realistic and following previous trends we would likely see a pullback to the mid or even low $5000 range without the market cap being impacted. If we were to reach $5000 the upside for the alts is nothing short of mouthwatering. Gains, as always, favor the patient.