ETH price will be the deciding factor of market trend instead of Bitcoin if this happens








ETH is the second largest cryptocurrency based on its market capitalization. Therefore, there is a general consensus that it leads the altcoin market. When ETH goes up, altcoins usually follow.


In addition, it is often assumed that when market capitalization increases, Bitcoin increases at a faster rate than altcoin, while while market capitalization decreases, altcoin declines at a faster rate. This will make Bitcoin a market leader.


However, the trader "il Capo Of Crypto" has come up with another idea. He stated that ETH price and total crypto market capitalization are positively correlated. This means that when one variable moves upward the other will follow, and the same holds true for the opposite movement. This is an interesting statement, because there is always a consensus that BTC is the market leader, instead of Ether.



Let's compare ETH price volatility with total market capitalization to determine if it is truly market leader.


ETH vs. Market capitalization


The comparison is made using the ETH / BTC pair. Therefore, when we say ETH is rising, it means that ETH is increasing at a faster rate than Bitcoin. The same is true when we say that Ether is falling.


In the chart below, the time periods during which ETH and cryptocurrency market capitalization have a positive correlation are shown in green, while in contrast, is in red.


ETh can be done at the beginning of school 2


  • January 1, 2019 - June 26 = Capitalization increased, ETH decreased

  • June 26 - September 5 = Capitalization decreased, ETH decreased

  • September 5 - November 5 = Capitalization decreased, ETH increased

  • November 5, 2019 - February 16, 2020 = Increasing capitalization, ETH increases

  • February 16 - Present = Capitalization decreases, ETH declines.

Therefore, since the beginning of 2019, the current period is the longest that the two variables have a positive correlation. This appearance started on November 5, 2019 and has been taking place for the past 131 days.


This does not mean that hodl Ethereum is more beneficial than hodl BTC. As we can see in the chart, when market capitalization fell, Ether prices fell at a slower rate than BTC. However, long Ether will bring more profit as the market capitalization increases compared to BTC. It has not been determined whether this correlation will continue in the future.


In short, if the current correlation between total market capitalization and Ether continues to be maintained, ETH price will be the decisive factor for the market trend, instead of Bitcoin.


You can see the price of ETH here.


Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.


Annie


According to Beincrypto




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