Pantera Capital: Bitcoin’s (BTC) Market Share to Drop in 2021
Pantera Capital has released their June 2020 Blockchain Letter.
The letter highlights the possibility of alt-coins outperforming Bitcoin henceforth and into 2021.
Alt-coins are known to perform well mid to late of a bull cycle and the drop in Bitcoin’s dominance could indicate that the time is nigh for alts.
Amidst this week’s turbulent Bitcoin market, the team at Pantera Capital have released their June 2020 Blockchain Letter to investors. In the Blockchain letter, named ‘Outperforming Bitcoin’, the team explores the possibility of alt-coins experiencing a resurgence in the market after BTC stealing the show due to its halving event in May of this year.
Bitcoin and the Crypto Markets are in a Bull Market
According to the report, Bitcoin is in a bull market based on the reaction by investors to the money printing activities of the global central banks.
The tsunami of money has increased the price of cryptocurrencies generally. We have used bitcoin as a proxy for the market because it is best known.
Furthermore, the report explained that it is not just Bitcoin experiencing a bull market. Pantera Capital expects alt-coins to start outperforming BTC as the bull market matures in the second half of 2020 and in 2021. To explain this point, the Blockchain letter provided the following chart and the proceeding explanation.
Since the start of this year, we can see that alt-coins have begun outperforming bitcoin (alts are represented in the chart by an index of 20 mid-cap cryptocurrencies), and we expect them to do so on and off over the remainder of 2020. But in 2021 — as the bull market matures — we expect for alts to gain a significantly larger market share relative to bitcoin.
Bitcoin’s Dominance is Dropping
In the final section of the Blockchain letter, the team explored BTC’s dropping dominance and its effects on the general crypto-verse.
“Bitcoin dominance” — bitcoin’s share of the total cryptocurrency market — was 64.60% in mid-March. It peaked on May 19th at 68.73% and is now back at 64.60%. We expect it to decline as other cryptocurrencies begin to out-perform — as discussed above.
As Bitcoin attempts to find a footing in the crypto-markets, its dominance has continued to decline and could provide a chance for alt-coins to once again flourish in the crypto markets. This fact has been explored by Pantera Capital in their June 2020 blockchain letter that postulates a scenario where alts will thrive in 2021. According to the report, Bitcoin and the entire crypto market is in a bull cycle as a result of the continual Quantitative Easing by global central banks. The tsunami of money printing will increase the price of cryptocurrencies in general.
Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of EWN or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.