Bitcoin Without Rival, Ethereum Collapses

As Bitcoin strengthens its position as the undisputed leader, Ethereum seems to be wavering. Crypto analyst Benjamin Cowen, followed by hundreds of thousands of investors, predicts a major turning point in the relationship between these two market giants.

The growing dominance of Bitcoin

According to Cowen, Bitcoin is not ready to give up its place. He observes an upward trend in Bitcoin’s dominance, that is, the ratio of its market capitalization to the entire crypto market.

It’s also the view of Bitget’s Analyst:

The expected performance of BTC in October is anticipated to be better than in September, with a target price range of $58,000 to $72,000. The specific reasons are as follows:

1. Improved Macro Liquidity Priced In: In September, the U.S. Federal Reserve announced a 50 basis point interest rate cut, lowering the federal funds rate to 4.75%-5%. This signals a formal shift in monetary policy. The Fed’s clear signal of injecting liquidity into the market led to a short-term rise in both the U.S. stock market and the crypto market. After adjustments in Q2 and Q3, BTC now presents a good opportunity for accumulation.

2. Bottoming Indicators: In September, there were several instances of negative funding rates in the BTC futures market. This was primarily caused by spot market sell-offs, which led to the liquidation of long futures positions. Coupled with the Fear & Greed Index fluctuating around “Extreme Fear” during the month, historical data shows that after the appearance of negative funding rates and extreme fear sentiment, there is often a significant chance for a rebound.

3. Institutional Optimism: MicroStrategy continued to sell bonds in September to purchase more BTC, and BTC ETFs saw continued net inflows following the interest rate cuts. This indicates that institutions are optimistic about the market outlook. With ongoing institutional buying, BTC is likely to break previous highs.

This rise means that Bitcoin is attracting more and more investors, to the detriment of altcoins. Cowen points out that this trend could lead to a further drop in the ETH/BTC pair. In other words, Ethereum would lose more ground to Bitcoin.

But why such a rise of Bitcoin? Several factors come into play. Renewed confidence from institutions, Bitcoin’s resilience to market fluctuations, and its status as a digital safe haven all contribute to strengthening its dominant position.

Ethereum facing imminent capitulation

On the other hand, Ethereum seems to be entering a critical phase. Cowen claims that ETH/BTC is about to reach a cycle low. He believes that Ethereum is in the “final stages of capitulation” against Bitcoin. This situation suggests that the price of Ethereum could continue to fall relative to that of Bitcoin.

However, not everything is bleak for Ethereum. Cowen mentions the possibility that ETH could reach its lowest level before other altcoins. This means that Ethereum could stabilize and eventually rebound before other cryptocurrencies hit rock bottom.

He warns, however, that the worst-case scenario would be a temporary rebound followed by a new low in December. Currently, ETH/BTC is trading around 0.04125 BTC, or about $2,597. This situation prompts investors to remain cautious and closely monitor market developments.

Towards a new balance in the crypto market?

Cowen’s prediction opens the door to much speculation. If Bitcoin continues on its trajectory, it could crush the competition further and strengthen its status as a pillar of the crypto market. Altcoins, and in particular Ethereum, will then have to find new strategies to attract investors.

For traders and cryptocurrency enthusiasts, this information is crucial. It allows them to anticipate market movements and adjust their portfolios accordingly. Cowen’s analysis highlights the importance of staying informed and responsive to the changing dynamics of the crypto world.

In conclusion, the battle between Bitcoin and Ethereum is far from over. While Bitcoin currently appears unrivaled, the future of cryptocurrencies remains full of uncertainties. Also, discover the four pillars of the next bull run.