Bitcoin and Ethereum: Crypto market rally isn’t done yet
Proactive Investors
Published Mar 20, 2023 20:14
Updated Mar 20, 2023 20:30
Bitcoin and Ethereum: Crypto market rally isn’t done yet
Bitcoin (BTC) continues to fly in the face of considerable uncertainty in the traditional markets.
With Asian markets having a rough session, London’s footsie blue-chip index opening lower and US futures failing to deliver the good news, BTC/USDT has hit a new 2023 high, ramping above US$28,000 for the first time since June 2022.
BTC/USDT hits new yearly highs – Source: currency.com
Similarly impressive, open interest on bitcoin options has taken off, exceeding US$10bn for the first time since the crypto bull run in November/December 2021.
The call-to-put ratio on open interest is nearly 2:1, indicating predominantly buying interest in the market.
Turmoil in the banking sector, exasperated by today’s news of a massively discounted buyout of Swiss G-SIB Credit Suisse (SIX:CSGN) by rival UBS has revitalised bitcoin and its status as a safe haven asset.
As an aside, both digital gold and physical gold are enjoying a rally, with the latter cruising above US$2,000 an ounce for the first time since mid-2020.
Pending interest rate decisions from the US Federal Reserve and the Bank of England this Wednesday could act as a roadblock or tailwind, depending on their perceived hawkishness or dovishness.
In the meantime, Binance’s order book is showing a fair bit of selling pressure at US$28,500, which could act as a rejection point, but with bitcoin's ongoing strength, nothing is for sure.
Altcoins fall out of favour
Bitcoin’s exceptional performance on the spot markets hasn’t necessarily translated to the wider cryptocurrency markets.
In what appears to be a flight to quality of sorts, investors are snubbing more volatile, less perceptively risky altcoins.
Even Ethereum (ETH), the world’s second-largest cryptocurrency, is vastly underperforming - ETH/USDT is up 12% week on week compared to BIT/USDT’s 27% rally.
As a result, bitcoin dominance (i.e. its share of global market capitalisation) continues to soar, having hit 47.7% from 42% prior to the recent spate of turmoil in the traditional markets.
Source: tradingview.com
Solana (SOL) had a strong overnight session in the top-20 set by adding 18%, but the ETH killer was considerably oversold and at US$23.26 remains 14% the year-to-date high.
Polkadot (DOT), Tron (TRX), Ripple (XRP) and BNB remained essentially flat in the past 24 hours, while Polygon (MATIC) actually fell nearly 2%.
Global cryptocurrency market cap is currently US$1.18tn/US$634bn excluding bitcoin, while total value locked in the decentralised finance (DeFi) space is US$49.21bn.
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