Bitcoin does seem particularly stable over the last few weeks, consolidating just under a key $10,000 benchmark.
However, comments by Binance CEO Changpeng Zhao might seem a little strange to traders who understand the perennial role of Bitcoin in today’s markets.
Jordan Lyanchev at Cryptopotato reports that Zhao is suggesting we’re in an “altseason” for more obscure digital coins, talking about the popularity of crypto coins like LINK and Dogecoin and citing Elon musk’s endorsement of the latter dog-faced digital asset. Then, also, Lyanchev suggests that Zhao indicated that Bitcoin itself has “turned into a stablecoin.”
Traders reading this might be forgiven for launching into immediate criticism of Zhao’s remarks, considering that Bitcoin is well known for its volatility, whereas stablecoins are by definition pegged to fiat currencies. Even though the price has been fairly stable for a while, a 52-week range of $7000 or nearly its full current value shows that Bitcoin is likely to spiral up and down in reaction to certain market responses. What we do know is that Bitcoin doesn’t largely track with U.S. equities, which makes it a popular alternative play for American investors when trouble strikes the stock market.
To bring some measure of resolution here, when you look at the end of Lynachev’s report, you see that Zhao is largely talking tongue-in-cheek. He does say the bitcoin will rise, which is part of a pretty broad consensus around where crypto goes long-term.
The takeaway here is that all joking aside, Zhao’s input is valuable in an environment where exchanges like Binance are trend-setters in a rapidly growing market.
But Zhao isn’t the only one curious about a lack of current volatility on BTC. Other analysts are also looking long-term to see if the nature of the Bitcoin market is changing.
“(A) gradual reduction in volatility can be interpreted as showing that the overall market for bitcoin has been growing more stable,” wrote Charles Bovaird in February at Forbes prior to the May halving, which did not move markets nearly as much as projected. In fact, the new halving is one of the most prominent clues telling many analysts that BTC is now more immune to wild swings.
Do your own research and act accordingly.
