2020-2-13 19:44 |
The crypto market is enjoying a bull run that has the leading cryptocurrency up over 40% in 2020 so far. Though we couldn’t breach the $10,500 level yesterday, we are still above $10k. While Bitcoin is running, altcoins are flying.
With altcoin prices jumping, many analysts are calling for the start of ‘alt season' with Ethereum (ETH) up 100%, XRP 57%, Bitcoin Cash (BCH) 121%, BSV 269%, Tezos (XTZ) 122%, Cardano (ADA) 95%, Monero (XMR) 101%, Dash 201%, IOTA 92%, Lisk 225%, Bitcoin Diamond 221%, DigixDAO 177%, and Hedera Hashgraph (HBAR) by 383% to name a few.
Crypto market performance in 2020 so far, Source: Coin360 But why are we flying?For altcoins’, alt season has officially started as Mati Greenspan, founder of Quantum Economics recently said on BlockTV that it is definitely that time of the year. He said,
“Altcoins are outperforming Bitcoin on an on a consistent day-to-day basis pretty much since the beginning of the year.”
He explained how the US airstrike on Jan. 3rd had market realizing that “Bitcoin could potentially be used as a safe haven from geopolitical events.” Since then, he said we have been looking at a “very risk on market” with altcoins outperforming which means that “investors are looking to take risk, which is pretty much different from safe-haven trading.”
And Bitcoin?Could it be the deadly coronavirus? Previously, in his daily newsletter, Greenspan ridiculed the effect of coronavirus on bitcoin stating,
“Crypto is neither acting like a safe haven in the face of the virus, nor is it selling off with the other risk assets. Rather, it remains completely uncorrelated.”
The main advantage of crypto assets actually is that they are unaffected by the external factor, which makes it a “great hedging tool,” he said.
So, what is it then?Less than three months away Bitcoin reward halving certainly plays a part with retail investors excited about this historically bullish event. It “remains one of the strongest divers from a fundamental perspective,” he said. But there’s another factor and that’s the Federal Reserve pushing money into the markets.
Former eToro analyst explained on BlockTV that coronavirus isn’t even affecting the stock markets. The real reason could be investors’ assumption at the moment that any gaps in production, due to several cities in China being shut down because of the virus, “can be easily covered by the injection of free money by the world's central banks.” As we saw with Tesla, Greenspan said,
“The People's Bank of China has already injected some hundred and seventy billion dollars into their economy. The Fed has recently resumed their quantitative easing so as the European Central Bank. So we're very much in an environment of money being pushed on the market, free money with low-interest rates which is why the stock market has been going completely bonkers.”
And “all of that free money that's being introduced into the market, some of this is actually ending up into the crypto market,” he added.
Popular analyst PlanB who is known for using the stock-to-flow model to determine Bitcoin value also shares Greenspan’s opinion as he hypothesis, “Bitcoin keeps rising as long as FED, ECB and PBOC keep printing.”
“Let's face it: central banks have lost control with QE and negative interest rates. #bitcoin,” tweeted the analyst on Wednesday.
Bitcoin (BTC) Live Price 1 BTC/USD =$10,244.0897 change ~ -0.93%Coin Market Cap
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