Since then, the price of Bitcoin has been corrected and most of the crypto market has followed suit. Bitcoin is currently trading at just over $ 35,000, and while traders view the pullback as a healthy correction needed for Bitcoin to maintain its bullish momentum, some believe the cryptocurrency could fall below $ 20,000.
As usual, the Bitcoin price movement has also been reflected in the altcoin market, with many popular cryptocurrencies rising sharply alongside BTC. Notably, Ether (ETH), the native token of the Ethereum platform, has doubled in the last month and is currently over $ 1,300.
While Bitcoin has surpassed its all-time high to date, several coins in the top 100 have yet to do so despite significant price increases. This could suggest a new Alt season is coming, especially if multiple DeFi tokens break into the top 20 market cap, although the direction of Bitcoin price remains uncertain. Jonathan Hobbs, the author of The crypto portfolio and a former digital asset fund manager told Cointelegraph:
“Bitcoin dominance has decreased compared to altcoins. Although it is not yet a full-blown “old season”, the signs are certainly there for one. I would love to see Ethereum break the $ 1,500 level for final confirmation of the alt-season. “
While the recent crypto rally has brought the global cryptocurrency market cap to $ 1 trillion, there have been some notable cryptocurrencies that have not kept up with the growth of Bitcoin for various reasons.
Ripple and the law
After some bullish action in November, the price of XRP started falling sharply on December 22nd after reports that the US Securities and Exchange Commission were preparing to take legal action against Ripple, its CEO Brad Garlinghouse and co-founder Christian Larsen. With the company overcoming other regulatory issues in the past, many hoped the news wouldn’t mind.
However, by December 23, XRP was down 41% and the exchange began delisting the cryptocurrency. By the end of December, XRP was delisted from major exchanges such as Coinbase, Binance US and OKCoin, with a few exceptions such as Uphold and GateHub, which leave the crypto to trade until a court decision is made. Currently, XRP is at $ 0.28 and has fallen 47% in the past 30 days.
Keeping up with ether
While Bitcoin rallied in December and January, Ether rallied alongside. Ether has grown significantly since December 18, although it has barely managed to hit its all-time high so far. However, other smart contract-oriented projects failed to follow suit despite Ether’s rally. These include NEM, EOS and Tron, all of which are among the top 30 biggest monthly losers in the top 100 cryptocurrency list by market capitalization.
While NEM has lost 21.6% of its value in the past 30 days, it did so after a sizeable price hike in November. EOS and Tron prices fell 11.6% and 2.69%, respectively. Both Block.one, the company behind the EOSIO ecosystem, and Tron have had problems with regulation in the past. The former received a $ 24 million fine from the SEC in October 2019, and the latter are currently facing a lawsuit related to their initial 2017 coin offering.
However, a more plausible reason these projects aren’t growing alongside Bitcoin is because they’re seen as direct competitors to Ether, which had a huge hit last month and is home to most of the DeFi industry. Hobbs said to Cointelegraph:
“Bitcoin and Ethereum have already proven themselves through real use and strong network effects. Bitcoin is digital gold. Ethereum is home to over 95% of all DeFi Smart contracts. I think that makes them less speculative than other digital assets right now. “
Monero, Dash, Zcash and other privacy coins
Data protection coins also came under fire in 2020. On January 1, the US exchange Bittrex announced that it would delist Monero (XMR), Zcash (ZEC) and Dash, the three largest anonymity-oriented cryptocurrencies on the market. While the listing of these cryptocurrencies was an initiative by Bittrex, this is not a complete surprise, especially as regulators continue to crack down on crypto.
On December 23, the U.S. Treasury Department’s Financial Crimes Enforcement Network released a proposed rule change stating that anonymity-enhanced cryptocurrencies like the above are becoming increasingly popular, and presumably more closely related to illegal activities such as money laundering and ransomware attacks.
Since there are still frequent hacks in decentralized financing and other crypto sets and the funds are disposed of at crypto exchanges, it also makes sense that the venues want to distance themselves from undetectable money laundering and adhere to pending regulations.
As a result, trust in coins for privacy protection seems to have been shaken. Monero and Dash rose 0.79% and 3.79%, respectively, over the past 30 days. While these numbers don’t seem bad, they pale in comparison to the price history of Bitcoin. According to Dr. Octavius, co-founder of the DeFi protocol OctoFi, the growth of the DeFi space can help these coin types overcome any upcoming regulatory hurdles:
“For many of these projects, their days as a ‘product’ are probably numbered, but the opportunities to focus on having them as ‘features’ are certainly ample. […] Those who value privacy will go to great lengths to find it. As long as there is improper access to it, projects that enable this can continue to be successful. “
Another predominant type of token that seems to have gotten on the sidelines during the BTC rally was tokens issued by centralized exchanges, including Nexo, Unus Sed Leo (LEO), and Crypto.com Coin (CRO). While the basic value proposition for these tokens remains the same, in some ways they are related to the success of the venues they are associated with and are mainly used for discounts on trading or credit fees or other perks.
With DeFi on the rise, it is likely that people will prefer to speculate on DeFi-related tokens or invest in the earnings logs themselves, which could be responsible for the slow price movements in these assets. LEO is down 1.66% and Nexo is up 11.3% in the last 30 days.
What’s next for alts?
While it is unclear what the road looks like for coins like XRP, Dash, Monero, and ZEC, whose future appears to be heavily dependent on upcoming regulation, there appears to be a general shift in interest when it comes to altcoins, especially multi-coins DeFi tokens are starting to take their place in the top 20 market cap list.
Smart contract platforms are also unlikely to see Ethereum dethroned anytime soon, especially as the network continues to make strides towards full Eth2 release. Not all of Ethereum’s competitors are doing badly, however, as, for example, the price for Near Protocol (NEAR) has recently increased by 106% in the current DeFi craze.
Some have noted that the current bull market is likely to scrap speculative coins as more value is now focused on Bitcoin and Ethereum, a marked departure from what was seen at the 2017 rally that pushed BTC to its all-time high so far.
On December 16, the price of Bitcoin surpassed its all-time high of just over $ 19,500, previously hit on December 17, 2017, according to CoinMarketCap. Since then, Bitcoin (BTC) has seen an incredible bull run that has taken cryptocurrency to new heights. It hit an all-time high of $ 41,941 on Jan. 8, rising over 115% during that time.