As we move into this year, it’s clear that altcoins should be treated with caution. While there may be fleeting moments of altcoin rallies, they tend to be short-lived, and the risks far outweigh any potential rewards. Bitcoin ($BTC) has shown resilience, remaining in the $90,000 to $100,000 range, while Ethereum ($ETH) has faced challenges, and altcoins have seen significant declines. Many altcoins have fallen to key support levels, and further bearish cycles could see them shrink by as much as 90% over the next year.
During bear markets, it’s important to recognize that altcoins, even the most popular ones, tend to follow Bitcoin’s movements. As BTC’s dominance continues to increase, ETH and other tokens often struggle to maintain their position. History has shown that during bear cycles, over 80% of altcoin projects tend to fail, making it crucial to be selective in how you allocate capital.
That said, the safest bet in the current market is to hold USDT as a stable asset until the interest rate cuts happen in June. Until then, you will have the opportunity to make moves when the market starts to turn. Looking ahead, a strategy where 80% of your portfolio is dedicated to BTC and 20% to carefully selected traditional altcoins will be key. This approach is ideal for weathering market volatility while ensuring that you are well-positioned when the next market cycle comes around.
Finally, considering the strength of the US dollar, we won’t see another wild bull run like the previous ones unless there is a significant change. For that to happen, we would need the US dollar to experience a significant drop, with exchange rates falling below 7.15.
Main conclusions:
BTC Dominance: Continue to prioritize Bitcoin in your portfolio.
Beware of altcoins: Avoid overexposure to altcoins as many are likely to underperform.
#CryptoStrategy $BTC $ETH #BTCDominanceInfluenceOnTheMarket #BearMarketInsights #LongTermGrowth
