Since then, the price of Bitcoin suffered a correction, and most of the crypto market followed. Bitcoin is currently at just over $ 35,000, and it is traders suggest the withdrawal to anticipate a healthy correction Bitcoin to maintain its bullish momentum, some believe the cryptocurrency can dip below $ 20,000.
Bitcoin’s price action has also been reflected in the altcoin market, as usual, with many popular cryptocurrencies rising alongside BTC. Noticeable, Ether (ETH), the native token of the Ethereum platform, has doubled in value in the last month and is currently at over $ 1,300.
While Bitcoin has passed its previous all-time high, several coins in the top 100 have yet to do so despite significant price increases. This could indicate that a new alt season may be coming, especially if there are several DeFi tokens are breaking into the top 20 market cap even if the direction of Bitcoin’s price remains uncertain. Jonathan Hobbs, the author of The Crypto Portfolio and a former digital asset manager told Cointelegraph:
Bitcoin dominance has started to decline against altcoins. While it’s not a full ‘alt season’ yet, the signs are certainly for it. I would like to see Ethereum break the $ 1,500 level for one final confirmation of the alt season. “
While the latest crypto rally the global cryptocurrency market cap up to $ 1 trillion, there are a few notable cryptocurrencies that have failed to keep up with Bitcoin’s growth for a variety of reasons.
Ripple and the Law
After some bullish action in November, XRPThe price started to plummet on December 22, following reports the US Securities and Exchange Commission was preparing for take legal action against Ripple, the CEO, Brad Garlinghouse, and co-founder Christian Larsen. Given that the company has overcome other issues with regulators in the past, many hoped the news would come to nothing.
However, on December 23rd, XRP was down 41% and exchanges started deleting the cryptocurrency. Late December XRP has been removed from the major exchanges such as Coinbase, Binance US and OKCoin, with a few exceptions such as Uphold and GateHub leaving the crypto to trade until the court’s decision. The XRP is currently at $ 0.28 and is down about 47% in the last 30 days.
Keeping up with Ether
While Bitcoin rallied in the month of December and January, Ether has rallied alongside it. Since December 18, Ether has grown significantly, although it has barely reached its highest point so far. However, other smart contract focused projects have not followed, even with Ether’s rally. These include NEM, EOS and Tron, all of which are in the top 30 for the largest monthly losses in value in the top 100 cryptocurrency list by market cap.
While NEM has lost 21.6% of its value in the past 30 days, it did after a significant price hike in the month of November. EOS and Tron prices have fallen 11.6% and 2.69% respectively. Both Block.one, the company behind the EOSIO ecosystem, and Tron have had regulatory issues in the past, with the former received a $ 24 million fine from the SEC in October 2019 and the latter is currently facing one lawsuit regarding the first coin offering of 2017.
However, it seems that a more plausible reason these projects aren’t growing alongside Bitcoin is that they are seen as direct competitors to Ether, which has had a great run over the past month and is home to most of the DeFi industry. Hobbs told Cointelegraph:
“Bitcoin and Ethereum have already proven themselves with real-world usage and strong network effects. Bitcoin is digital gold. Ethereum houses more than 95% of all DeFi smart contracts. I think that makes them less speculative than other digital assets at the moment. “
Monero, Dash, Zcash and other privacy coins
Privacy coins also came under fire from regulations in 2020. On January 1, US stock exchange Bittrex announced it would delist Monero (XMR), Zcash (ZEC) and Dash, the three largest anonymous cryptocurrencies on the market. While the removal of these cryptocurrencies was an initiative of Bittrex, it doesn’t come as a complete surprise, especially as regulators continue to tackle crypto.
On December 23, the U.S. Treasury’s Financial Crimes Enforcement Network released a proposed rule change, stating that anonymous-enhanced cryptocurrencies, such as the ones mentioned above, are growing in popularity and are believed to be more closely related to illegal activities such as money laundering of money and ransomware attacks.
As frequent hacks on decentralized finance and other types of cryptocurrencies continue to occur, with the money being divested through crypto exchanges, it also makes sense that the venues want to distance themselves from untraceable money laundering and to comply with future regulations.
As a result, confidence in privacy coins appears to be shaken. Monero and Dash are up 0.79% and 3.79% respectively in the past 30 days. While these numbers don’t seem bad, they pale in comparison to Bitcoin’s price action. According to Dr. Octavius, co-founder of DeFi protocol OctoFi, the growth of the DeFi space could help these types of coins survive future regulatory hurdles:
“For many of these projects their days as a ‘product’ are probably numbered, but the possibilities to turn to existing ones as ‘features’ are certainly many. […] Those who value privacy will do everything they can to find it, and as long as there is unauthorized access to it, projects that make it possible can still thrive. “
Another predominant type of token that appears to have remained on the sidelines during the BTC rally were tokens issued by centralized exchanges, including Nexo, Unus Sed Leo (LEO) and Crypto.com Coin (CRO). While the basic value proposition for these tokens remains the same, they are somewhat tied to the success of the locations they are associated with, and are most commonly used for discounts on trade or loan fees or other benefits.
With DeFi on the rise, it seems likely that people would rather speculate on DeFi-related tokens or invest in the yield farming protocols themselves, which could explain the slow price action on these assets. LEO is down 1.66% in the last 30 days and Nexo is up 11.3%.
What’s next for alts?
While it’s unclear what the path holds for coins like XRP, Dash, Monero and ZEC, the future of which appears to be strongly tied to upcoming regulations, it seems there is a general shift in interest when it comes to altcoins, especially because DeFi tokens start take their place in the top 20 market capitalization list.
As for smart contract platforms, it also seems unlikely that Ethereum will be dethroned anytime soon, especially as the network continues to make strides towards the full release of Eth2. However, not all Ethereum competitors fare badly, such as the price of Near Protocol (NEAR) is up 106% recently amid the current DeFi craze.
Some have commented that the current bull market is likely to do away with speculative currenciesas more value is now concentrated on Bitcoin and Ethereum, a marked deviation from what was seen during the 2017 rally that took BTC to its previous all-time high.
On December 16, the price of Bitcoin surpassed the previous record high of just over $ 19,500, previously reached on December 17, 2017, according to data from CoinMarketCap. Since then, Bitcoin (BTC) has seen an incredible bull run, driving the cryptocurrency to new heights, reaching an all-time high of $ 41,941 on Jan. 8 and an increase of over 115% during this time.