Traders Are Flocking to ‘Blue Chip’ Bitcoin and Fleeing Altcoins, Says Analyst Benjamin Cowen – Here’s Why

Pop­u­lar strate­gist Ben­jamin Cowen says that a real­lo­ca­tion of funds is occur­ring in the cryp­to asset space with Bit­coin (BTC) emerg­ing as the major beneficiary.

Cowen tells his 783,000 YouTube sub­scribers that Bit­coin dom­i­nance is ris­ing as peo­ple dump alt­coins in favor of the “blue chip” cryp­to asset.

Accord­ing to Cowen, even Ethereum (ETH) also los­es val­ue rel­a­tive to Bit­coin as peo­ple real­lo­cate to the king crypto.

“The alt­coin mar­ket is high­ly illiq­uid and peo­ple are flock­ing to the rel­a­tive safe­ty of the blue chips that sends the dom­i­nance of Bit­coin higher…

The alt­coin mar­ket bleeds to ETH and Bit­coin. The­o­ret­i­cal­ly, ETH bleeds to Bit­coin as well. The dom­i­nance goes up and it sends you the Bitcoin/US dol­lar val­u­a­tion high­er at the expense of the alt­coin mar­ket liquidity.

At some point, the alt­coin mar­ket liq­uid­i­ty can no longer sus­tain the Bit­coin price… as Bit­coin rolls over, the alt­coin mar­ket gets even more wrecked.”

The pop­u­lar cryp­to ana­lyst says that Bit­coin is more appeal­ing cur­rent­ly than alt­coins due to the pre­vail­ing macro­eco­nom­ic environment.

“We essen­tial­ly have this dynam­ic where this liq­uid­i­ty from the low­er liq­uid­i­ty assets are seek­ing out the rel­a­tive safe­ty of the high­er liq­uid assets, right.

Because in times of eco­nom­ic uncer­tain­ty, which I guess times are always uncer­tain. But in times like this where there’s there’s plen­ty of macro stuff to talk about: invert­ed yield curve, high infla­tion, a more hawk­ish Fed­er­al Reserve than we’ve seen in 40 years, peo­ple are going to seek out the rel­a­tive safe­ty of the blue chips with­in that asset class…

Peo­ple that are not in cryp­to with sort of scoff at the idea of call­ing Bit­coin a blue chip but it’s all about with­in the asset class that you’re inter­est­ed in what is the blue chip con­sid­ered, right? And in cryp­to, it’s Bitcoin.”

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Gen­er­at­ed Image: Midjourney