The Bitcoin price continues its sideways trading as investors switch their attention to better-performing altcoins. Dominance slips to 3-year lows.
BTC/USD is currently trading at $58.660 and up +2.04% in Sunday trading.
Bitcoin seems to have found a base between $53000-$55,000. Whilst it has stopped falling, it’s not exactly flying. Since touching close to $65,000 in April, it has traded broadly sideways to lower.
I believe the Bitcoin price will test the highs again soon, but this would represent a rally of just 10% from its current price.
When you compare Bitcoin’s 2021 performance to that of its peers, it’s easy to see that investors have been rewarded by looking further down the Crypto value chain.
Bitcoin Price Relative Performance
Since the start of the Year, Bitcoin has returned investors a respectable +100%. Doubling your money in just over four months is an amazing return. However, when compared to other large coins, it pales into insignificance:
As the Bitcoin price topped out in April, capital has been diverted into lower value coins. It makes sense in that Investors see more potential upside in holding multiple lower value coins rather than a smaller amount of the largest cap digital asset.
With the growth of decentralized (DeFi) finance, the Bitcoin price is likely to continue its relative underperformance.
Bitcoin will continue to play a major part in digital asset portfolios and is recognized as a great Store of Value (SoV). Its deep liquidity pools and ease of access will tick many boxes for institutions looking to diversify portfolios.
However, an increasing number of altcoin investment vehicles are being launched. This could see further capital allocations weighted less in Bitcoin’s favor in the future.