According to the co-founder of DataTrek Research, current global instability is making Bitcoin a popular choice of safe-haven asset. Nicolas Colas believes that the leading crypto asset’s price swings can be used as an indicator for other markets and global events.
He also argues that Bitcoin’s relative immaturity compared with traditional asset classes will mean that the volatility that has become synonymous with crypto assets looks set to continue.
Cole: Bitcoin’s Rising Dominance Makes it the “Standard of All Crypto”
Appearing in a CNBC interview earlier today, the co-founder of financial research and analysis firm DataTrek Research states that Bitcoin is serving as a convenient vehicle for capital flight out of turbulent economies.
Nicolas Cole argues that the current global economic picture is starting to resemble that of 2008-09 when Bitcoin was created. It was born in “turmoil”, he reasons.
The researcher goes on to comment on the global nature of the crypto asset and that its convenience may make it a more attractive safe-haven than other options.
Turning his attention to rising Bitcoin dominance versus the rest of the crypto market, Cole states:
“Over the last year or year-and-a-half Bitcoin has become the standard of all crypto.”
The leading digital asset has steadily been climbing in relation to other cryptocurrencies since it reached a market dominance low in 2018. From just one-third of the total market at the start of last year, Bitcoin now represents 67 percent of the all crypto coins’ market capitalisation combined.
Cole speculates as to why this might be the case:
“A lot of scammy coins have died and Bitcoin has been left standing.”
In response to a question about whether Bitcoin and other crypto assets could be used as an indicator for shifts in other markets, the research specialist replied:
“We are definitely seeing that and it really perked up around the Hong Kong protests and some of the currency flights that happened out of Hong Kong and the mainland.”
Cole claims that Bitcoin was one of the few assets that “predicted that ahead of time”:
“Nothing else was really moving but Bitcoin was.”
He also states that similar crashes to that which shocks many newcomers to the industry in early 2018 definitely will happen again and that there is no way to avoid them. The relative immaturity of the market versus other asset classes makes it unreasonable to expect the price to behave in any other way at this point:
“It’s important to understand in all cryptocurrencies… they are always going to be very volatile. It’s still a very young technology, a very young safe-haven. It’s not going to be as stable as gold or bonds.”
Related Reading: Safe Haven? Bitcoin Price Falls Below $11,000 Alongside Gold Bull Rejection
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Ripple Price (XRP) Eyes Fresh Increase While Bitcoin Rallies
- Ripple price is facing a strong resistance near the $0.2900 and $0.2920 levels against the US dollar.
- Bitcoin price rallied recently and even broke the $10,600 and $10,800 resistance levels.
- Yesterday’s highlighted bullish trend line is active with support near $0.2750 on the hourly chart of the XRP/USD pair (data source from Kraken).
- The pair could decline a few points, but it remains supported above $0.2700.
Ripple price is currently correcting gains from $0.2920 against the US Dollar, while bitcoin jumped above $10,800. XRP price is likely to climb sharply if it clears the $0.2920 resistance.
Ripple Price Analysis
Yesterday, we saw a decent recovery in XRP price above the $0.2700 resistance against the US Dollar. The XRP/USD pair even climbed above the $0.2800 resistance and settled above the 100 hourly simple moving average. It opened the doors for more gains above the $0.2850 level. More importantly, there were decent gains in other altcoins, including Ethereum, EOS and litecoin.
However, ripple price faced a strong resistance near the $0.2900 and $0.2920 levels. A swing high was formed near $0.2918 and the price recently started a downside correction. It broke the $0.2850 support plus the 23.6% Fib retracement level of the recovery from the $0.2618 low to $0.2918 high. Finally, the price found support near the $0.2750 and $0.2760 levels.
Additionally, the price found support near the 50% Fib retracement level of the recovery from the $0.2618 low to $0.2918 high. More importantly, yesterday’s highlighted bullish trend line is active with support near $0.2750 on the hourly chart of the XRP/USD pair. The 100 hourly SMA is also following the trend line and is currently near $0.2720. Therefore, dips towards the $0.2750 and $0.2720 levels remain attractive to the bulls.
On the upside, the main resistances are near $0.2900 and $0.2920. An immediate resistance is near $0.2880 and a connecting bearish trend line on the same chart. A convincing close above the $0.2920 level might start another upward move towards the $0.3000 and $0.3050 levels. An intermediate resistance is near the $0.3020 level.
Looking at the chart, ripple price is currently trading nicely above the $0.2750 and $0.2720 support levels. Therefore, there are chances of a fresh increase above the $0.2880 and $0.2920 resistance levels. Conversely, a successful hourly close below the $0.2700 support might negate the current bullish view in the coming sessions. The next key support is near the $0.2550 level.
Hourly MACD – The MACD for XRP/USD is about to move back into the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for XRP/USD is currently just below the 50 level.
Major Support Levels – $0.2750, $0.2720 and $0.2700.
Major Resistance Levels – $0.2900, $0.2920 and $0.3000.