Binance's August report indicates: Altcoins will rise again
Binance Research, the research arm of Binance, released its monthly report for August on September 4, claiming that altcoins are expected to rise again relative to Bitcoin, and pointing out that Bitcoin's market dominance is eventually expected to decrease to around 50%.
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Bitcoin briefly surged to $12,000 in early August, only to fall back to $9,500 by the end of the month. As it crossed the $10,000 mark again, Bitcoin dominance also reached a new high of 70.8% for the year.
On the other hand, altcoins showed no signs of improvement in August, with market sentiment shifting from "when will they recover" to "will they recover?"
In cooperation with @Binance Trading, here is our latest overview of August's #cryptocurrency markets through an institutional lens.
Amongst them, #Bitcoin dominance reached new highs, and altcoin volumes were near an all-time low. https://t.co/pNHAzYA7tJ
— Binance Research (@BinanceResearch) September 4, 2019
Greater Altcoin Volatility
Since August, Bitcoin's price has only dropped by 2.9%. The other assets in the top ten cryptocurrencies have seen greater declines.
ETH, BNB, EOS, XLM, and ADA have all dropped by over 20% from the previous month. LTC, the worst performer last month, fell by 33.42%. XRP, XMR, and BCH dropped by 19.67%, 15.96%, and 15.68% respectively.
Altcoins Making a Comeback
Binance's trading department speculates that altcoins may be on the verge of a revival. A report stated:
Our view is that Bitcoin doesn't necessarily need altcoins to achieve value storage and can still become "digital gold."
The performance of each altcoin depends on the activity level of the project, and altcoins are an essential part of the growth process in the cryptocurrency market.
The report reiterated the predictions made in the previous monthly report, still believing that Bitcoin's dominance will return to around 50% to 60%. When this will happen remains unknown. The researchers stated:
In the short term, Bitcoin's dominance may continue to monopolize.
Cantering Clark, co-founder of the crypto investment learning platform Blockroots, believes that the altcoin market will return only after Bitcoin breaks $20,000, stating:
If Bitcoin doesn't break its all-time high, the next altcoin bull market is unlikely to come. Or Bitcoin dominance drops to 40%, but this dominance is unlikely at the moment.
According to previous reports by ABM, analysts have mixed opinions on whether altcoin prices will stabilize, but they unanimously agree that Bitcoin dominance will continue to rise.
Recent research also suggests that if liquidity flow is taken into account, Bitcoin's actual dominance has exceeded 90%. If this argument holds true, then the altcoin bull market may not be far off.
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