Veteran Trader Peter Brandt believe Bitcoin dominance hints at a breakout as he spots a strange range pattern on the chart. This could allow Bitcoin to outperform altcoins.
source: peter brandt
According to Brandt, the Bitcoin Dominance chart is forming a 24-month rectangle with multiple upper and lower boundaries touching.
This is because the Bitcoin Dominance Index has fluctuated between 38% and 48% for more than 2 years. Brandt believes this is still a limited scope at the moment. However, an eventual breakout of this range will be significant.
Predicting Bitcoin to outperform altcoins, he highlighted:
“In my opinion, Bitcoin will bury all its followers. In the end there will only be one king, and that will be Bitcoin.”
According to data from transaction viewbitcoin dominance — or the ratio of BTC’s market capitalization to the entire cryptocurrency market — retreated after hitting a 10-month high of 48.9 percent on April 12.
At the time of writing, Bitcoin dominance stands at 46.8%, close to its highest level since June 2022.
Bitcoin season?
Wu Blockchain Report The number of transactions on the Bitcoin blockchain hit an all-time high of 426,337 on April 29. This may be related to the need for inscriptions on Bitcoin serial numbers. On April 29, the single-day minting volume of Bitcoin exceeded 20,000 for the first time, setting a new high.
According to researchers enter the block, the seven-day average of bitcoin’s daily trading volume hit its highest level since December 2017 this week. An increase in daily transaction volume indicates an increase in usage of the blockchain.
source: enter the block
Meanwhile, according to on-chain analytics firm glass node, block 787,500 will be mined soon, so the Bitcoin halving event is only about a year away. The Bitcoin halving event occurs automatically and pre-programmed every 210,000 blocks.
The average block time is 14 days, with 367 days until the next halving, due to the erratic hash rate and estimated block searches being probabilistic. So the estimated date is around 30/4/2024.
Bitcoin Reserves on U.S. Exchanges Fall
Bitcoin reserves on U.S. exchanges dwindle. According to CryptoQuant data, this trend persisted across all exchanges, but was particularly pronounced on U.S. exchanges.
U.S. Regulatory Requirements Lead to Decline #bitcoin American exchange reserves https://t.co/QlQ4612llI
— Kyptos (@azcoinnews) May 1, 2023
There could be a number of reasons for the reduction in reserves, but one of the most important is the regulations recently implemented by the U.S. Securities and Exchange Commission (SEC). With stricter regulatory requirements, Chinese investors will trust domestic exchanges less, causing them to transfer coins to foreign exchanges or personal wallets.
Source: CryptoQuant
The SEC has been taking stricter measures to protect investors from fraud and misconduct in the cryptocurrency market. However, an unintended consequence of these regulations was that investors lost confidence in domestic exchanges, leading to a reduction in Bitcoin reserves. As a result, dominance will likely shift to foreign exchange transactions that are not subject to the same legal requirements.
Although the U.S. government aims to protect its citizens, it risks falling behind other countries in the digital currency market if policymakers continue to exert pressure on the cryptocurrency market. Many countries have embraced the benefits of this space, and some have even created their own digital currencies. If the world’s leading power fails to adapt to market changes, it could lose its leadership in the financial industry.
In short, the decline in Bitcoin reserves on U.S. exchanges is worrisome. While regulatory measures are necessary to protect investors, they must be implemented in a manner that does not impede innovation and growth in this market. If the U.S. is to maintain its leadership in the industry, it must find a way to balance regulation with the benefits of this nascent technology.
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Ming Ying
according to Kyptos
