Bitcoin Unleashes Crypto Euphoria as Coin Market Cap Hits 14-Month High
Bitcoin’s epic rally toward $13,000 has triggered a fresh wave of buying across the altcoin universe, pushing the total coin market cap past $365 billion for the first time since May 2018.
Crypto Euphoria Spreads
The total cryptocurrency market has added $33 billion over the past 24 hours, with bitcoin accounting for more than three-quarters of the tally. The largest cryptocurrency crossed $12,900 on Wednesday and was last valued around $12,600, having gained 11.3% over the 24 hour cycle.
Ethereum (ETH) quickly followed in bitcoin’s footsteps, climbing 11.5% to $346.36. Ether is now trading at its highest level since August 2018.
XRP’s slow grind to the north continued on Wednesday. The so-called banker’s cryptocurrency jumped 4.3% to $0.4855. XRP is moving within a bullish structure and is subject to a bigger breakout now that the price has crossed $0.4800. The initial upside target is $0.5600, which is the high from early November.
Bitcoin cash (BCH) has moved back into the fourth spot in the market-cap rankings, gaining 8.2% to $511.07. That was the first time this year that BCH crossed the $500 level.
After a long consolidation phase, Litecoin (LTC) jumped 3.3% to $138.16. LTC is still trading just below its yearly peak.
The rest of the top-ten reported firm gains through the early part of Wednesday trading. EOS climbed 4.1% to $7.42, Binance Coin (BNB) added 1.9% to $37.30 and bitcoin SV (BSV) rose 3% to $244.98.
Combined, the total crypto market cap is now worth $366.4 billion.
What’s Driving the Rally?
The crypto market’s explosive run to the north is being driven primarily by bitcoin. The largest and most influential cryptocurrency has tripled in price over the past three months and now eats up 61.2% of the overall market cap. That’s the highest level in around two years.
Bitcoin is being driven higher by several factors, including a record surge in hash rate, higher transaction numbers and the continuation of an accumulation phase that began earlier this year. To the latter point, bitcoin users have been buying up and holding the virtual currency with no intention to offload it anytime soon.
Bitcoin’s disinflationary supply schedule and the growth of institutional onramps suggests there will be a large increase in demand over the next few years. Bitcoin’s upcoming halvening event, scheduled for May 2020, is expected to boost values for the foreseeable future.
While altcoins and tokens have performed well this year in U.S. dollar terms, they’ve been getting crushed relative to bitcoin. As Hacked previously documented, the ETH/BTC exchange rate provides a good window into altcoin season and its potential. While the probability of an altcoin bull run has increased recently, the ETH/BTC exchange rate appears to have turned bearish once again (it is currently valued at 0.02689). So long as the ETH/BTC pair is below 0.03, it will be hard for altcoins to keep pace with bitcoin in the short term. Read more: Ethereum’s Catch-Up Game Could Spark the Next Major Crypto Rally.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Charts via CoinMarketCap.