The bitcoin and altcoins market has since been on a rollercoaster ride over the past few months, with investors looking to profit at every opportunity, especially with the current trend of meme coins such as PEPE, Aidoge, TURBO being created. But.
Now, with the bitcoin halving around the corner, renowned crypto analyst Michael van de Poppe believes the time has come to hoard alternative coins.
In a tweet published earlier today, analyst noted:
For Altcoins, it’s time to accumulate them. One year before halving -> time to buy those positions. Here a critical level is reached, which is also almost there. 1 year before halving.
Time to go long Altcoins
Van de Poppe shared his analysis of historical data on the market cap dominance of altcoins and identified key areas from 2016 where altcoin price action has gone according to his prediction prior to the bitcoin halving.
Historical chart of Altcoins market cap dominance. , Source: van de poppe
According to the analyst, several altcoins may attract investments, leading to an increase in the market cap dominance of altcoins.
Specifically, a bitcoin halving is an event that occurs every 210,000 blocks mined, roughly every four years. This is a mechanism to ensure the scarcity of bitcoin, which helps maintain its value.
During a halving, the block reward is cut in half, reducing the supply of new bitcoins that can be produced. The last bitcoin halving took place on May 11, 2020, and the next one is expected to take place between April and May 2024.
According to van de Poppe, the year before bitcoin’s next halving is the perfect place to take that buy position on altcoins. His current estimate is reinforced by a significant level of altcoins market cap dominance, which is roughly a year away from the next bitcoin halving.
This is the time when the market experiences an increase in the price of altcoins, which leads to an increase in the demand for these cryptocurrencies.
While the analyst didn’t indicate which alt coins to acquire, he went ahead to ask his nearly 657,000 Twitter followers, “Which coins are you hoarding?”
Expected reaction after bitcoin halving
Altcoins are making significant strides in the crypto market, and their dominance is on the rise. Over the past year, we have seen a significant increase in the dominance of altcoins such as Ethereum (ETH), Binance Coin (BNB), Dogecoin (DOGE) and Cardano (ADA).
The market cap value of Altcoins is trending sideways on the 1-day chart. Source: Crypto Total Market Cap on Other Tradingview.com
According to CoinMarketCap, bitcoin currently has about 40% market dominance, while altcoins account for the remaining 60%. This is a significant change from a year ago when bitcoin dominance was close to 70%. Regardless, the altcoins market is expected to see an increase in prices after the bitcoin halving.
In the past, altcoins have shown a tendency to outperform bitcoin in the year following the halving event. This is mostly because investors often look for alternative investment opportunities when the price of bitcoin becomes too high, and altcoins can provide an attractive alternative.
Given Van de Poppe’s current sentiment, the coming months could be an important time for investors to accumulate altcoins as the bitcoin halving is set to take place between April and May next year.
Following the halving event, the block reward for bitcoin miners who confirm a transaction on the network will drop to 3.125 BTC.
Featured image from iStock, Chart from TradingView
source: www.newsbtc.com