Customize Consent Preferences

We use cookies to help you navigate efficiently and perform certain functions. You will find detailed information about all cookies under each consent category below.

The cookies that are categorized as "Necessary" are stored on your browser as they are essential for enabling the basic functionalities of the site. ... 

Always Active

Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.

No cookies to display.

Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.

No cookies to display.

Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.

No cookies to display.

Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.

No cookies to display.

Advertisement cookies are used to provide visitors with customized advertisements based on the pages you visited previously and to analyze the effectiveness of the ad campaigns.

No cookies to display.

Ethereum (ETH) Volumes Converge With Bitcoin; Will ETH Lead The Next Bull Run?

admin Avatar
Ethereum (ETH) Volumes Converge With Bitcoin; Will ETH Lead The Next Bull Run?

Ethereum (ETH) volumes appeared to be converging with those in its larger peer Bitcoin (BTC), recent data showed. The world’s second-largest cryptocurrency has seen a spike in interest this year ahead of a widely anticipated shift to a proof-of-stake (PoS) model.

ETH price has surged over 20% in the past two weeks, and was trading at around $3,400- close to breaking even for the year. Daily volumes have also steadily risen, averaging at roughly $20 billion over the past week.

BTC price also shot up to 2022 highs this week, and was trading around $47,000. But while volumes did increase, they were substantially lower than the massive amounts of liquidity seen in 2021. Still, the world’s largest cryptocurrency commanded over 40% of total crypto market capitalization.

But the latest crypto rally has also seen several altcoins vastly outperform BTC, while notching record highs in market capitalization. A similar scenario was observed during the start of the 2021 rally, which had eventually challenged BTC’s dominance.

ETH, BTC volumes seen converging

Data from blockchain research firm Kaiko showed that convergence in ETH and BTC volumes has been increasing since 2021. At certain points over the past year, the seven-day moving average volumes for the two tokens were at the exact same levels.

The data could point towards a broader shift in market structure, where BTC volumes taper further and market liquidity flows into several other projects. The proposed phenomenon is called “Altcoin Season.”

While BTC’s market dominance has so far remained unchallenged, its decreasing volumes could shake this status quo. The crypto market boom in 2021 severely undercut BTC’s market weightage, bringing it down to 42% today, from the massive 71% seen at the end of 2020.

Is it altcoin season?

Tokens including Cardano (ADA), Ripple (XRP), Terra (LUNA) and Solana (SOL) have blown past BTC in the past two weeks, in terms of price performance. Further gains in their market capital could threaten BTC’s dominance.

ETH’s shift to a PoS model has drawn institutional interest into several other projects in the sector. Increasing interest in DeFi, as well as scrutiny towards BTC’s high energy requirements could also draw capital away from the token.

Currently, the top 10 altcoins have a combined market capital of roughly $700 billion, compared to BTC’s $894 billion.

Leave a Reply

Your email address will not be published. Required fields are marked *