Bitcoin absorbed a wider share of the cryptocurrency market in the midst of another week of dramatic fluctuations. Bloomberg reports that the leading cryptocurrency now owns nearly three-quarters of the market:
“Its market capitalization is above $211 billion, 10 times that of the next-largest digital asset, Ether. And in a week when traditional financial markets were roiled, its price has held up, too: Bitcoin rose 14% over the seven days through Friday, while prices for alternative assets including Ether and XRP dropped.”
As I write Bitcoin is trading at about $11,400, according to Coin360. CoinTelegraph reports that its price fell roughly $400—from $11,800 to $11,400—between 7:30 and 7:45 Saturday morning. Meanwhile, “Ether (ETH) is holding onto its position as the largest altcoin by market cap, which currently stands at $21.9 billion. The second-largest altcoin, Ripple’s XRP, has a market cap of $12.45 billion at press time.”
Yoni Assia, co-founder and CEO of online trading platform EToro, told Bloomber in a recent interview that the altcoin market should be approached with extreme caution, given its volatility.
“As much as Bitcoin was a risky asset class, I think alt coins are significantly riskier,” he said. “A lot of people got burned or had a bad experience during crypto winter.” He added that some altcoin investors saw their values plunge by up to 90%. Crypto winter refers to a brief period of time toward the end of 2018 which saw digital assets sold off in rash, erratic fashion.
Some analysts are suggesting that Bitcoin has profited, and will continue to profit, from the anxiety and uncertainty triggered by the ongoing trade war between Washington and Beijing, the end of which doesn’t appear to be anywhere in sight. Given Bitcoin’s independence, more investors are turning to it.
“Are people buying Bitcoin because it’s a speculative asset class and borrowing is now cheaper?” Bloomberg quotes David Martin, chief investment officer at Blockforce Capital, as inquiring. “Or [because] there’s a lot of global uncertainty and this caught a lot of traders and asset managers off guard so they’re flocking to an uncorrelated asset right now? You can make an argument for both right now.”