Crypto Analyst: Altcoin Annihilation Responsible for Bitcoin Breakdown
This week, the “altcoin annihilation” really ramped up, despite already causing such devastation to crypto investors. The selling pressure and negative sentiment were enough to also drag Bitcoin price down as well.
While altcoins are free-falling, one crypto analyst says that although altcoins are currently causing “turbulence” for Bitcoin, it will resume “moon mode” as soon as the alt selloff begins to cool down.
Altcoins May Drag Down Bitcoin, But They Won’t Stop the Bull Run
This week, EOS, Ethereum, and Litecoin massively dumping their USD values dragged Bitcoin price down under $10,000, shocking bullish crypto investors that assumed $10,000 would be unbreakable.
It’s long been said that the negativity and fear surrounding altcoins could be enough to cause Bitcoin to collapse, despite others being confident that Bitcoin has already embarked on a bull run, and that it’ll slowly grind up at support and eventually set new highs. The former is proving to be true, and Bitcoin price is struggling to reclaim $10,000.
Despite altcoins leaving Bitcoin on the ropes, one prominent and often-cited crypto analyst, Plan B – known for his stock-to-flow model that helps apply Bitcoin’s hard-coded scarcity to future price projections – says that the current “altcoin annihilation” is causing some “turbulence” on Bitcoin’s moon mission, and is just refueling its jets in order to resume its bull run once “skies are clear” and the altcoin selloff finally starts to stall.
Previously, the analyst shared a chart that demonstrates how Bitcoin’s relative strength index shows similarities to the mid-2016 when Bitcoin’s highly-publicized bull run started to build a foundation.
The same is said to be happening now throughout the crypto market, with Bitcoin’s recent correction building support in which will act as the foundation for the next bull run.
Plan B’s stock-to-flow model is widely believed by highly respected financial industry figures. In the model, data suggests that Bitcoin price could reach $55,000 by May 2020 – when Bitcoin’s next halving occurs.
Each halving cuts the BTC block reward miners receive in half, throwing off the supply of Bitcoin and causing the price to rise. With crypto investors knowing this, the halving is expected to be front-run by investors buying up the digitally scarce Bitcoin in anticipation of its value rising significantly.
Bitcoin is the best-performing asset ever, easily beating the ROI of stock, gold, and much more. Altcoins, however, are still down significantly from their all-time highs and may never again achieve such values, even if Bitcoin were to reach $100,000 per BTC.
With the outlook so bleak for alts, the theory that Bitcoin might range for some time could be valid, as it may take a while for the “altcoin annihilation” and related “turbulence” to subside.