Amid a significant uptrend in crypto prices, altcoins are beginning to outperform Bitcoin (BTC), marking a notable shift since the historic highs of 2021. This surge coincides with Bitcoin nearing an all-time high of $100,000, fueled by the presidential election victory of Donald Trump, who positions himself as a pro-crypto leader.
However, Bloomberg reports that the uncertainty stemming from the 2021 crypto collapse remains palpable among investors, as many altcoins experienced dramatic price fluctuations during past market cycles.
Expert Voices Skepticism On Altcoins Rally
Altcoins have shown impressive gains, with tokens like Solana (SOL) reaching new all-time highs, while many others have more than doubled in price since the beginning of the year.
Historically, altcoins tend to outperform Bitcoin during market rallies but can also experience sharper declines during downturns due to their higher volatility and lower trading volumes.
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The crypto market has been cautious since major players like FTX and crypto lender Celsius collapsed, which contributed to a significant bear market. Despite this, recent activity indicates a resurgence, with increased trading volumes and price rises among altcoins throughout November.
Interestingly, James Butterfill, head of research at CoinShares, expressed skepticism about a massive altcoin rally, particularly in light of potential regulatory changes, including a proposed national Bitcoin reserve.
Republican Senator Cynthia Lummis has introduced the Bitcoin Act, which seeks to allocate funds from the Federal Reserve’s gold reserves to acquire a strategic stockpile of 1 million Bitcoin.
Butterfill told Bloomberg that the political implications of such legislation could significantly affect market dynamics, potentially increasing Bitcoin’s dominance over its peers.
ETF Approval Hopes Could Boost Crypto Interest Under Trump
While Solana stands out as the only major altcoin to surpass its previous highs this year, experts like Nikolay Karpenko from crypto trading firm B2C2 believe this rally could differ from the 2021 experience.
The expert highlighted the industry’s maturity over the past few years, which has seen improvements in risk management and the entry of “more strategic” and institutional investors into the crypto space.
As altcoins continue to gain traction, data shows that trading…
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