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- According to Benjamin Cowen, bitcoin dominance will keep rising.
- Cowen’s prediction is based on the potential for interest rates to go down.
- A falling interest rate would directly impact the Altcoin market capitalization.
According to Benjamin Cowen, founder of Into The Cryptoverse (ITC), bitcoin dominance is increasing. Cowen made the statement during a discussion on the Altcoin Daily YouTube crypto channel. The reason behind Cowen’s prediction is the potential for interest rates to go down, which would directly impact the Altcoin market capitalization.
Using the ‘Total 3’ indicator, which measures the market cap of all cryptocurrencies except bitcoin and ether, the renowned analyst showed that the altcoin market attracts net liquidity. He defined net liquidity as the balance sheet of some of the top central banks like the Fed, the ECB, the central banks of Canada, the UK, China, and Japan, among a few others.
Cowen showed that the altcoin market tracks net liquidity by overlaying the net liquidity metric over the Total 3 indicator. He also noted that the net liquidity is going down, suggesting that the altcoin market would follow the same direction. According to the ITC founder, the altcoin market still has a leg lower to go, even though it may not happen.
Furthermore, Cowen explained that if the altcoin market fails to go down, it would be because bitcoin already showed a lot of strength. Hence, if bitcoin gets a significant rally, it would likely raise the altcoin market. According to the analyst, while this is ongoing, there might be some isolated events when particular altcoins would pop up and rally significantly. Cowen explained that such events result from capital rotation rather than new money entering the space.
Looking ahead, Cowen noted that the altcoins that recently rallied did so on the back of a bitcoin rally. However, he acknowledged paying attention to such altcoins and monitoring their behaviors in relation to bitcoin. He thinks it would take a confirmed breakout above the current resistance to instigate a significant rally for the altcoins.
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