Investors seem to be unsure about Altcoins. With the spurs of good news with Bitcoin climbing to see better price highs and Ethereum releasing 2.0, and PayPal adopting crypto, you would assume altcoins are winning.
The news keeps coming and appearing sweet as ever, with China adopting its digital Yuan and major countries like Canada announcing they will go crypto. The growth of Central Bank Digital Coins is not necessarily a good thing.
Crypto coins’ newfound popularity also comes with limitations. Coins like Ethereum have seen better days, and Bitcoins price has been fluctuating. Let’s peer at the activity Altcoins have seen recently.
On Coinmarketcap.com, the coins below were in the top three in that order. It is good to peer at the top three coins because they create a precedent for the other currencies as people tend to explore them first.
Towards the latter end of November, Bitcoin seemed a bit more consistent, but the sudden peaks would have caught investors by surprise. BTC experienced great HV inclines on the 18th, the 27th of November, and the 2nd of December.
On the dates not mentioned, the coin seemed pretty consistent.
Like BTC, Ethereum was very volatile throughout November. The only time the coin was consistent was between the 9th and 19th of November.
Ethereums sudden changes could be due to uncertainty caused by the launch of ETH 2.0. Stage 0 of the new ETH finally came out on the 2nd of November 2020, but up until then, investors were unsure of when the product would launch.
People would have kept getting excited and purchasing ETH, expecting the release of ETH 2.0 to find it was not ready to come out. So, the behavior of this coin can be explained by the ETH 2.0s release.
Unlike ETC and BTC, Ripple (XRP) was pretty consistent between the 29th of October and the 19th of November. From the 19th of November, the coin started seeing high peeks and shallow troughs compared to the highs.
Altcoins & Covid-19
Overall, the Altcoins seem to be very volatile, especially towards the end of the November period. The changes could be due to investors’ uncertainty due to the pandemic, as it appears like the days of lockdowns and working from home are coming to an end. Times going back to pre-covid conditions would open a lot of investment opportunities.
There has been news of a Covid vaccine being established, which was finally launched on the 2nd of December. It is common practice for investors to invest in shares when they are worthless and then sell them when they are worth more.
Now would be a good time for investors to choose a business they think will excel once things get back to normal, which is bad news for cryptocurrency. Another factor that could be causing volatility could be the launch of more CBDCs.
There is currently China’s digital Yuan, while more countries catch up. Many countries, such as Saudi Arabia and Canada have recently announced they will launch a CBDC.
Countries like Lebanon, India, Mongolia, Switzerland, France, and the US have indicated they want to go crypto.
Having a saturated crypto space can take away attention from the other coins which exist. Publicity is the lifeblood of consistent price inclines because the more media attention a coin gets, the more demand it will likely get, which will keep the price high. High demand for a long time keeps the price high for a long time too.
There is a lot of uncertainty around these times.