The volatility of Bitcoin (BTC) today caused the volatility in the cryptocurrency market to peak after a long time. The BTC price fell close to 20% within a few hours. Although altcoins also followed BTC as usual, this time the decline was very different from the others. Ethereum (ETH) in particular took a different stance from previous declines.
ETH rose while BTC fell
Famous economist Alex Krüger explained in a tweet why this decline is different from the others. According to Krüger’s statement, for the first time in history, Bitcoin may have fallen 10% in a day, while Ethereum may have increased by 20% or more. Describing the last 24 hours as “incredible”, Krüger may have expressed the thoughts of many cryptocurrency investors.
— Alex Krüger (@krugermacro) January 4, 2021
Looking at the Bitcoin and Ethereum correlation chart published by Coinmetrics, it seems that Krüger may have its fair share. According to the BTC-ETH correlation chart, the link between the two cryptocurrencies peaked on August 20, 2020 and climbed above 0.88. It is seen that the correlation, which has been decreasing continuously after this date, was hit hard on January 4 and decreased to the level of 0.75.
Expectations for Altcoin season increase
It has been seen that the ETH price has turned upside down even when the Bitcoin price has experienced a slight decrease in the previous periods. Now that this situation is starting to change, altcoin investors’ hopes are increasing. The BTC market dominance rate has changed dramatically in the past 24 hours. The decline of Bitcoin’s market dominance from 73 levels to 69 levels is seen as another positive news for altcoin investors.
When the price of Ether starts to push $ 1,200, such a decline may cause altcoin investors to wait a little longer for the rally.