Right now, Bitcoin is declining and so is Ether after setting all-time highs. But certain sectors of the crypto market are looking beyond recent concerns and doing well.
Take Z-Cash, for example, which is up about 30% since early November, according to Bloomberg data. The Avalanche token is also holding up well, gaining around 50% in the last seven sessions, while the Crypto.com CRO coin has advanced enough to become the thirteenth largest by market cap, which has soared to $ 18 billion.
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It’s not unusual for so-called altcoins to hold their own while their older siblings suffer a more difficult time. That’s because many are tied to specific narratives that help propel them higher. Crypto.com, for example, last week announced a deal to replace Staples as the title sponsor of an iconic Los Angeles sports center. Analysts say that helped the CRO token rise.
“The typical altcoin investor right now is hanging around trying to find the next big move,” said Stephane Ouellette, CEO and co-founder of crypto platform FRNT Financial Inc.
Meanwhile, the major cryptocurrencies have been engulfed in a selloff over the past week that has seen Bitcoin approaching a 20% correction from its recent record high. Ether, the second-largest digital asset by market value, is down 8% from its November 10 high.
Bitcoin fell 5.9% at 3:44 pm in New York on Monday to trade around $ 56,029. Ether fell about 6.6% to around $ 4,079.
“Despite a bit of turbulence, it’s still technically a bull market,” said Mati Greenspan, founder and CEO of Quantum Economics. “So money that comes from large-cap currencies can easily get into some of the smaller ones.”
The strategists cited a number of reasons why Bitcoin and some of the other traditional cryptocurrencies have been sold, including China’s crackdown on cryptocurrencies and new US tax filing provisions that are considered hostile to investors. Cryptocurrencies have also soured sentiment.
The biggest tokens had run very far, very fast, so “it has been a natural consolidation of the environment, of the price action, having gone up so much in such a short period of time,” Thomas Perfumo, Head of Business Operations and Kraken strategy. he said on Bloomberg’s “QuickTake Stock” streaming show.
For Bloomberg Intelligence’s Mike McGlone, it makes sense to see a bit of respite for some of the tokens that sell out so quickly.
“For the market in general, I see a wall of concern, repeating and filling within the bull market,” he said. “Shiba Inu is getting too expensive, which was too hot a sign for the whole market, like Doge in May.”
Still, Kraken’s Perfumo says there are plenty of positive catalysts left for crypto prices to go up. He cited Jerome Powell’s appointment to the Federal Reserve, among other reasons.
“I am as optimistic as possible about this industry in the long term,” he said.
© 2021 Bloomberg