According to Benjamin Cowen, the founder of Into The Cryptoverse (ITC), Bitcoin’s dominance is on the rise. Cowen made this statement while discussing on the Altcoin Daily YouTube crypto channel. The basis for his prediction is the potential decrease in interest rates, which would directly affect the market capitalization of Altcoins.
By using the ‘Total 3’ indicator, which measures the market capitalization of all cryptocurrencies except for Bitcoin and Ether, this renowned analyst demonstrated that the Altcoin market is attracting net liquidity. He defines net liquidity as the balance sheet of major central banks like the Fed, ECB, central banks of Canada, the UK, China, and Japan, among others.
Cowen illustrated that the Altcoin market correlates with net liquidity by overlaying the net liquidity metric on the Total 3 indicator. He also noted that net liquidity is decreasing, suggesting that the Altcoin market is likely to follow the same trend. According to the founder of ITC, there’s still room for the Altcoin market to decline, although it may not necessarily occur.
Furthermore, Cowen explained that if the Altcoin market doesn’t experience a decline, it would be due to Bitcoin already demonstrating considerable strength. Therefore, a significant Bitcoin rally is likely to boost the Altcoin market. According to the analyst, during this process, there might be isolated events where specific Altcoins surge significantly. Cowen clarified that such events are a result of capital rotation rather than new funds entering the space.
In looking forward, Cowen pointed out that the recent surges in altcoins were closely tied to an upswing in Bitcoin’s value. However, he acknowledged the importance of keeping an eye on such altcoins and closely observing how they interact with Bitcoin. He believes that a significant rally for altcoins would require a confirmed breakthrough above the current resistance level.