- Altcoin season is likely delayed until the Federal Reserve cuts interest rates.
Bitcoin dominance is predicted to rise to 60% as altcoins lose value.
A well-regarded cryptocurrency analyst believes that until the Federal Reserve takes action, investors should not anticipate an altcoin season (altseason).
Crypto strategist Benjamin Cowen said in a recent video update that the altseason is unlikely to materialize unless the Fed eases monetary policy and lowers interest rates.
#Bitcoin: FOMC & CPI (Aftermath) pic.twitter.com/HGpMUoi9kc
— Benjamin Cowen (@intocryptoverse) June 14, 2024
Monetary Policy and Altseason
In the previous cycle, Cowen claims, altcoins performed better than Bitcoin (BTC) only when the Federal Reserve started lowering rates.
“More altcoins are falling than rising, and there are plenty of them. This is the reason why, as in 2019, before the Fed lowered rates, the advance/decline index is declining once more,” he explains.
Cowen points out that the index fell precipitously just prior to the July 2019 Fed rate reduction.
As many are predicting an altseason for altcoins to outperform Bitcoin, he advises monitoring this trend. He does stress, though, that this stage of the last cycle did not materialize until after the Fed reduced interest rates.
Expectations for Altcoin Performance
Cowen adds that until the Fed changes direction, he anticipates altcoins to keep losing out to Bitcoin. He said:
“I think Bitcoin will become more dominant, maybe reaching 60%. I believe the king of cryptocurrency will continue to devalue altcoins.”
He projects a dramatic increase in Bitcoin’s dominance throughout the next few months as it takes up liquidity from the alternative coin market. Cowen notes, “The total crypto market capitalization excluding Bitcoin (TOTAL2) sits at $1.049 trillion, while Bitcoin dominance is currently at 55.39%.”
Not too long ago, ETHNews reported on Arthur Hayes and Raoul Pal’s forecast of a Dogecoin ETF’s debut. This prospective change can have a big effect on the dynamics of the cryptocurrency market and complicate the current tendencies even more.
As of writing, Bitcoin has a dominance level of 55.39% and a $1.049 trillion total cryptocurrency market cap.