With so much negativity suddenly in the crypto market following increased regulatory concerns surrounding Bitcoin, Facebook Libra, and the rest of the asset class, the sell pressure and fear has caused altcoins to capitulate and even Bitcoin to begin to crash.
Altcoins are not only dropping to new lows in USD value, but their BTC ratios are at extreme lows. So low, that it if these ratios were maintained all the way to the top of the next Bitcoin bull run, even $100K BTC wouldn’t let most altcoins reach a new all-time high in USD value
If Altcoins Maintain BTC Ratio, $100K Bitcoin Won’t Take Them to New ATH
At the start of 2019, altcoins had outperformed Bitcoin, with many doubling in value in USD and in BTC ratio. Litecoin is a great example of this, and it stopped its rally after a 600% increase.
But since April, the once-correlated altcoins diverged from Bitcoin significantly, and have since gone on to reach new lows. Investors are capitulating, and much of it is being driven by fears of coming regulation, which has already caused a large portion of the market to be cut off from Binance, the leading crypto exchange.
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Still, most crypto investors are holding out hope for the promise of an “alt season” – a period at which selling in the asset class is fully exhausted, and the low liquidity combined with FOMO drives up the price of each altcoin significantly in no time. Such an occurrence brought many insane returns at the height of the Bitcoin bull run.
Anyone late to alt season got left stuck holding some expensive bags. Expensive bags that may never again return to their previous all-time high.
$BTC needs ~10x (930%) to hit $100K. If $ALT’s keep their ratio to $BTC during this time, 130/165 (79%) will still be below their all-time high reached during the last cycle.
The top 30 by mcap, and the % they would *still* be down from their high, are in the chart below. pic.twitter.com/N9j6Nkqmte
— Ceteris Paribus (@ceterispar1bus) July 24, 2019
According to a report from Messari shared by fundamental crypto analyst Ceteris Paribus, if altcoins maintain their ratio to BTC, even if Bitcoin reaches $100,000 – representing a 930% gain in the crypto asset – they “will still be below their all-time high reached during the last cycle.”
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During the peak of the crypto bubble, top altcoin Ethereum reached a high of over $1,400, with Ripple and Litecoin reaching $3.84 and well above $370 respectively. The analyst suggests that these altcoins would only possibly reach 79% of their all-time high values, which would put their long-term highs at or around $1,100, $3, and $292 for Etheruem, Ripple, and Litecoin – three of the most well-known altcoins with the most longevity, trust, and usages in the space.
Altcoins and alt season may have presented a once-in-a-lifetime opportunity for investors – an opportunity that is now in the past, and something investors still holding bags may have difficulty coming to terms with.
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