A widely followed crypto analyst says that Bitcoin (BTC) is still the best play for crypto market participants despite a week that saw altcoins spike in price.
In a new strategy session, Benjamin Cowen tells his 781,000 YouTube subscribers that altcoins are risky even as their prices surge because he believes the Bitcoin Dominance index (BTC.D) will rise regardless of which direction BTC takes.
The BTC.D chart tracks how much of the total crypto market capitalization belongs to Bitcoin. A bullish BTC Dominance suggests Bitcoin is rising faster than other crypto assets, or altcoins are losing value while the leading crypto surges. In a bearish scenario, a rising BTC Dominance indicates that altcoins are falling faster than Bitcoin.
Says Cowen,
“Whether [BTC] breaks out or whether it breaks down, the [BTC] dominance should go up either way. That’s the thesis: that Bitcoin dominance should go up regardless of whether Bitcoin breaks up or breaks down…
Ever since we got started in 2022, I said altcoins are just simply not worth the risk compared to Bitcoin… I don’t think they’re worth the risk yet [but] it doesn’t mean that some of them haven’t bottomed out on their USD pairs.”
Not only is BTC’s dominance level locked in to ascend, but Cowen also says Bitcoin is the better play for investors as it will attract less attention from regulators.
However, he notes that altcoins may start to flourish by the start of 2024 or the end of this year.
“Bitcoin remains the better play in terms of your risk-adjusted return, so for the risk you’re taking on, Bitcoin remains the better play now. From a fundamental reason why could that be? I think regulations…
Bitcoin isn’t going to have the same type of regulatory scrutiny that the altcoin market has, and I think 2023 is probably going to be a tough year for altcoins in the context of these regulations. Once we get to 2024 and maybe even late 2023, I’m gonna take off my maxi hat and I’ll probably [get] back into the altcoin market.”
Bitcoin is changing hands for $20,703 at time of writing, a fractional dip on the day.
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Featured Image: Shutterstock/Tithi Luadthong/Nsit
