Bitcoin Leads Gains Among Major Cryptos, What Does This Mean?
Since Sunday, Bitcoin has been on an upward rally that has renewed the market again. The digital asset went from trading below $20,000 to regaining its place above $24,000 again, all within a day. Naturally, other assets in the space have followed BTC’s lead and returned to green territory, but Bitcoin continues to outpace the majors in terms of gains.
Bitcoin is ahead of the pack
The vast majority of the crypto market is back in the green again, but Bitcoin has managed to stay ahead of the pack. Generally, cryptocurrencies in the market, especially the big companies, tend to closely follow the recovery pattern of BTC. But this time, they have not been able to maintain gains at the same level as the leading cryptocurrency.
Bitcoin’s rally saw it pass $24,000, and over the past day, the digital asset’s gains have soared over 12%. But while the major cryptocurrencies have also followed the rally, they have recorded fewer gains compared to the market leader.
An example of this is Ethereum, which is the only one of the major companies to maintain a performance of over 50% compared to BTC. In the last day, the second largest cryptocurrency by market cap is up 6.82% compared to BTC’s 12.21%.
BTC stays ahead of large caps | Source: Coinmarketcap
Going further down the list, BNB is only up 3.52% in the 24-hour period. Similarly, Cardano (ADA) is seeing a 3.32% gain, while Polygon (MATIC) and Dogecoin (DOGE) are up 5.25% and 5.16% respectively. XRP is the worst performer in the pack with just a 2.43% gain.
Altcoin season could change the narrative
Bitcoin historically starts to move before the rest of the market, but eventually the altcoins catch up. A period when altcoins in the market are increasing, regardless of whether BTC is moving or not, is known as “altcoin season”, and it is a period when altcoins start the race to catch up with Bitcoin’s gains.
BTC clears $25,000 resistance | Source: BTCUSD on TradingView.com
This is what happened in mid-2021 when altcoins began to rise exponentially right after BTC established support above the $40,000 gains. This gave altcoins time to catch up and lower market caps allowed for higher multiples when it came to gains.
Now, this may follow the same trend this time, which means that the gap between Bitcoin and the big capital may only be temporary. If this is the case, altcoins could easily stage a catch-up rally next week, which will see double-digit gains among the majors, and that liquidity will trickle down all the way to the small ones. Such a top-down rally can signal the start of the next bull market.
At the time of writing, Bitcoin has cleared the $25,000 level after being rejected early on Tuesday. $25,000 currently stands as the most important level for the digital asset to secure its short- to medium-term bull rally, and a comfortable move above this means $30,000 will be the next significant level.
