Bitcoin has started its bull run, but what about altcoins?

Bitcoin has started its bull run, but what about altcoins?

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Bitcoin looks to be starting the 4th bull run of its short 14 year history. However, will the altcoins follow as they always did in the past?

Bitcoin starts its bull run

After a huge move from a probable bottom, bitcoin topped at just under $31,000 just over a week ago. Since then, it has come down to rest above $27,000. Below are very strong supports, with the strongest of all being at around $25,000 with $20,000 and a rising 200-day daily moving average below that.

Bitcoin’s 12% correction so far is really nothing in the grand scheme of things. Bitcoin bull markets are notorious for their 30 to 40% drawdowns, and whether we get one now or later, it will not likely affect the general move to the upside.

Regulation to stunt altcoin growth

However, will the altcoins follow the general upward trend along with bitcoin?

In the past this has always been the case, and those speculating on certain altcoins have done very much better than if they had just held bitcoin. 

One very different barrier to this happening this time round might be the extremely negative treatment of cryptocurrencies by the Biden administration and the regulatory agencies.

One could say that bitcoin might also suffer from this, but thus far the SEC has not labelled bitcoin as a security, and it still remains to be seen if the US government can get together with enough overseas governments to perhaps exert sufficient pressure on bitcoin mining so as to slow general adoption.

Nevertheless, given the weakness of the banks and the potential for more failures as the US enters recession, trying to slow bitcoin just might not work as investors flee to an asset that is outside of the economy and unable to be manipulated by governments.

A small band of altcoins could flourish

Altcoins on the other hand are certainly being more openly attacked by the SEC in the US, and by regulatory agencies in several other countries. 

It doesn’t help that the vast majority of altcoins have failed to prove their use cases, although there are certainly some from which incredibly innovative technologies have sprung forth.

When bitcoin moves higher altcoins will normally always follow, although with far stricter and repressive regulations coming into force in different global jurisdictions, it remains to be seen whether more than a small and select group of altcoins will be able to outpace bitcoin this time around.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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