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Digital asset markets have started to recuperate this month withleading the charge, as it has done in previous recoveries. Industry analysts have envisioned this trend continuing, with BTC remaining in the driver’s seat for the wider cryptocurrency market.
So far this month, Bitcoin (BTC) has gained almost 14 percent as it returns to price levels it started the year at. The recovery has been faster than traditional assets, such as stocks, and industry research suggests that this trend is set to continue.
(ETH) has been on top this week, in terms of gains, and (LTC) has led previous rallies, but researchers at Blockchain.com are anticipating that Bitcoin will continue to drive the overall price action in the cryptocurrency market.
(5/5) We anticipate bitcoin (BTC) to continue to drive the overall price action in crypto.
— Blockchain.com (@blockchain) April 7, 2020
In its latest monthly newsletter, the cryptocurrency exchange and A crypto wallet is a device or app that stores digital assets. Unlike the physical wallet in your back pocket,... More provider summarized that the crypto markets have recovered since their mid-March crash. It added that Bitcoin dominance, which is currently at 65.2 percent according to Tradingview.com, will continue to increase throughout the coming year.
The research attributed positive on-chain metrics to this, stating that the hash rate has already begun to rebound — thanks to Bitcoin’s price recovery and the downward difficulty adjustment. Hash rates have already climbed back over 100 EH/s, which is not far off their all-time peaks.
The report added that less-efficient miners may be forced to sell more bitcoins due to depressed price levels and the halving, which is coming in 35 days’ time. This would have a positive effect on ‘stronger hands’ in the mining ecosystem, as they may face less pressure to liquidate their holdings, thereby reducing downward price pressure.
Other metrics, such as hash ribbons, also indicate that there will be no further mining capitulations and the ‘weak hands’ may have already powered down their hardware while they wait for a price recovery.
The report also attributed a strengthening ‘digital gold’ thesis and status as an emerging macro hedge to future Bitcoin performance. Blockchain maturity, when compared to other digital assets and more fiat on-ramps, are also contributing factors to the asset’s dominance for the year to come.
The newsletter concluded that March was one of the most turbulent months in financial market history. Bitcoin managed to outperform equities but was beaten by gold’s gains as it remains the world’s safest haven.
Other analysts, such as chart guru Willy Woo, still maintain that Bitcoin is a safe haven. His latest charts compare Bitcoin’s value growth versus other assets and have been plotted logarithmically over the past decade.
And they told me Bitcoin was a risky volatile asset…
(Plotted in log charts so % gains/losses are proportional within each respective sparkline) pic.twitter.com/qxC1xF8cay
— Willy Woo (@woonomic) April 7, 2020
It does appear, from these charts at least, that Bitcoin has been a more stable investment with greater value growth when compared to the S&P 500 and real estate.
Do you want to Be In Crypto?Join our Telegram Trading Group for FREE Trading Signals,a FREE Trading Course for Beginners and Advanced Tradersand a lot of fun! Images courtesy of Shutterstock, Trading View and Twitter.