Altcoins have performed extremely well in 2020, with a majority of reputable crypto projects easily outpacing Bitcoin. For instance, Ethereum is up 220 percent since the start of the year while BTC has gained a mere 70 percent.
This trend is expected to continue, with one prominent venture capitalist in the space arguing that the ongoing altcoin bull trend will eclipse the last one, during the crypto bull market of 2015 to early-2018.
Venture capitalist: Bitcoin dominance could fall lower this crypto cycle than the last
Kelvin “Spartan Black” Koh, a partner at The Spartan Group and a former Goldman Sachs partner, says that Bitcoin’s market dominance is likely to fall under the 33 percent all-time low in this market cycle:
“BTC dominance has been on a steady decline for the past 12 months. I expect this ratio to fall below the Jan 2018 lows (33%) in the current DeFi bull market. We are currently at 59%. Still a long way to go…”
BTC dominance has been on a steady decline for the past 12 months. I expect this ratio to fall below the Jan 2018 lows (33%) in the current DeFi bull market. We are currently at 59%. Still a long way to go….. pic.twitter.com/fPfADF5sui
— SpartanBlack (@SpartanBlack_1) August 29, 2020
This sentiment has previously been discussed by Nikita Zhavoronkov, lead developer at crypto data site Blockchair and a writer of Bitcoin privacy and scaling articles.
As reported by CryptoSlate previously, that individual that Bitcoin will lose the seat as the largest cryptocurrency to an altcoin this cycle. He cited the lack of “cool features” that users want being integrated into the Bitcoin blockchain, such as privacy technologies and smart contracts.
Zhavoronkov is betting on Ethereum taking over, writing on the matter:
“In order to overthrow Bitcoin, Ethereum needs to grow just 6x compared to Bitcoin. Not at all an impossible scenario (we’re in crypto, remember?). What happens if Ethereum switches to PoS, scales, and becomes #1?”
Synthetix founder: There’s a chance Bitcoin might not even rally much this cycle
There is a growing sentiment that Bitcoin will underperform altcoins this cycle, but one executive within the space has gone as far as to say that BTC may not move much higher at all. This is a striking difference to the sentiments shared by individuals like Raoul Pal and the Winklevoss Twins, who state that Bitcoin may hit $500,000 or higher this market cycle.
Kain Warwick, the founder of Synthetix, made the following comment on Aug. 30:
“There is a very real chance that BTC barely moves as this bull market plays out. The days of BTC as on-ramp to crypto are over, it’s being bypassed almost completely as new money comes in primarily via stablecoins.”
There is a very real chance that BTC barely moves as this bull market plays out. The days of BTC as on-ramp to crypto are over, it’s being bypassed almost completely as new money comes in primarily via stablecoins.
— kain.eth (@kaiynne) August 30, 2020
The reason behind this strong sentiment is his belief that capital flooding into Bitcoin does not sit in the leading cryptocurrency, but is instead distributed and contained by stablecoins.
These stablecoins, as suggested by on-chain flows, are increasingly being funneled into DeFi to earn yield or to be traded into altcoins.
Some pushed back against this sentiment. A historically accurate Bitcoin technical analyst opined:
“You’re saying that $BTC only acts as an on-ramp to other crypto and that is the sole reason why it moved previously – it’s a silly statement and you know it.”
Others, even those with a large interest in altcoins, disputed this sentiment, noting that the macro trends favor BTC’s growth in the coming years.
As always, the magnitude of the upside Bitcoin is likely to undergo this cycle is a contested subject matter, with each segment of the crypto industry having a different opinion.
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