Bitcoin Loses Ground to ETH and Altcoins

Bitcoin had fallen 3.62% by the end of April, despite it being on a ‘winning streak’ reaching up to 64,847 USDT on April 14th.

There are several factors to this, detailed in a report by OKEx, a cryptocurrency exchange for trading different cryptocurrencies. The Dollar Index fell from 93 to 90 in April, as well as the 10-year U.S Treasury yield fell from 1.75% in March to 1.53% in April.

OKEx noted these factors led to a general increase in price in risk assets, however, the Volatility Index, which highlights expected areas of volatility in the market, was also near the bottom. In contrast to Bitcoin, the S&P 500 Index and Nasdaq Composite rose at a strong pace in April at 5.3% and 5.4% monthly returns respectfully.

The Bloomberg Commodity Index has its strongest month at 8.3% due to inflation, and gold prices rose 3.6% due to the value of the dollar weakening.

Source: OKEx

Bitcoin futures

While previously benefitting from Coinbase going public, Bitcoins futures contracts premium rose to 11%.  This was picked up by arbitrageurs, and the day Coinbase was listed on Nasdaq, Bitcoin fell as the news came out.

A flash crash occurred on the third Sunday of April when liquidity was thin. Bitcoin had a 16% drop from 61,000 USDT down to 50,900 USDT at one point.

This resulted in the largest 24-hour period of liquidating across exchanges ever at $9.54 billion. Bitcoin’s interest fell by 27% on the same day and was not able to return to levels pre-crash until the end of the month.

During this crash, both quarterly and bi-quarterly futures were significantly below the perpetual swap price even if for a short time, this, in turn, caught many traders by surprise. Bitcoin did not start to come back around until April 25th, after it made a fake downward break to 47,000 USDT. Spot buying brought it to 57,142 USDT when the month ended according to OKEx spot price.

Ethereum posted its eighth consecutive month of gains in April, and its best monthly gain after January 2921 at 48%. Ethereums Berlin fork went live April 14th ahead of this summer’s London hard fork, which will include EIP-1559.

This resulted in ETH price jumping from 1,850 UDST in early April to 2,800 USDT by the end of the month. This encouraged more growth for altcoin, with the season index provided by Blockchain Centre reached 98 in mid-April, not seen since 2018.

This also resulted in Bitcoin falling 17% to become less than 50% by the end of the month, according to TradingView.

Dogecoin

Of the altcoins, Dogecoin was in the lead, the meme-originated coin had a 487% surge in April. This is largely driven by online traffic from social media like Twitter, especially when it comes to Elon Musk, the self-described ‘dogefather’.

Doge finished the month at a $42 billion market cap and has entered the top five cryptocurrencies measured by market cap on the big aggregator sites. On top of that, XRP grew 186% and ETC grew 167% in April alongside other altcoins performing well except for DOT.

Bitcoin

Source: OKEx

With the rise of Dogecoin, various other meme or dog-themed cryptocurrencies have spawned. Namely Shiba INU (SHIB), had significant returns at the start of May. These smaller altcoins building up can further cause Bitcoin to stagnate.

ETH has more room to grow due to as OKEx states a “strong bullish consensus in the market”. This along with other cryptocurrencies can still outperform Bitcoin in May as they have in the past.

May is the month where Bitcoin made very strong advances in the past and could be its saving grace, while the average returns of May are 21%, the market leader would need to be above 60,000 USDT before it can sit comfortably at the top.

This news is republished from another source. You can check the original article here

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