Despite a week in which altcoins saw price increases, a well-respected crypto analyst believes that Bitcoin (BTC) remains the greatest play for crypto market participants.
Benjamin Cowen warns his 781,000 YouTube followers in a new strategy session that altcoins are risky even as their prices grow because he believes the Bitcoin Dominance index (BTC.D) will rise regardless of which path BTC takes.
The BTC.D chart shows how much of the overall cryptocurrency market capitalization is owned by Bitcoin. A bullish BTC Dominance indicates that Bitcoin is rising faster than other crypto assets, or that altcoins are losing value while the leading crypto is increasing in value. A rising BTC Dominance shows that altcoins are falling quicker than Bitcoin in a bearish scenario.
“Whether [BTC] breaks out or whether it breaks down, the [BTC] domination should go up any way. That is the thesis: Bitcoin dominance will increase regardless of whether Bitcoin breaks apart or breaks down…
I’ve been saying since we started in 2022 that altcoins are simply not worth the risk when compared to Bitcoin… I don’t believe they’re worth the risk just yet, but it doesn’t mean some of them haven’t bottomed out on their USD pairs.”
Not only is BTC’s dominance set to rise, but Cowen believes Bitcoin is the better investment since it will get less attention from regulators.
He does, however, believe that altcoins will begin to thrive by the beginning of 2024 or the end of this year.
“Bitcoin remains the better option in terms of your risk-adjusted return, so for the risk you’re taking on, Bitcoin remains the better play presently. What might possibly be the reason for this? Regulations, I believe…
Bitcoin will not face the same kind of regulatory scrutiny as the altcoin market, and I believe 2023 will be a difficult year for altcoins in the context of these regulations. When we get to 2024, maybe even late 2023, I’m going to take off my maxi hat and possibly [re-enter] the altcoin market.”
At the time of writing, Bitcoin is trading for $20,703, a slight drop on the day.