BTC -> ETH
Alt Szn Is Upon Us
Please excuse the earlier edition of the newsletter with the same title. Something glitchy happened with Substack and the newsletter was published as I was still writing/editing it.
We are moving into what the crypto Twitterati like to call “Alt Season” (or “Alt Szn” if you are really cool). During Alt Season, Bitcoin continues to rise in price, but other coins - or “alt coins” - tend to outpace it. In the last week or so, we’ve seen Ether ($ETH), the cryptocurrency for the Ethereum blockchain, gain value as Bitcoin ($BTC) has been stuck in a bit of a rut. From now through the end this cycle, you’ll likely see $ETH make more significant gains than $BTC. Part of the reason $BTC is likely in a bit of a rut is that money is moving from it into $ETH.
A similar trend occurred in the 2017 bull run.
When I see the likes of Raoul Pal (Yes, I know I mention this guy a lot; not only is he incredibly insightful, but he is also a pleasure to listen to and a seemingly very kind person) post Tweets like the one below, I make changes to my portfolio.
The chart featured at the top of this newsletter is the same as the one featured in the Tweet above. It is a chart of Ether’s performance as compared to Bitcoin’s over the course of the past few years. Without getting too far into the TA (technical analysis), the main takeaway from the chart is that Ether is beginning to outperform Bitcoin. When patterns like this fully play out, they usually form a "bowl shape” on charts, which means that $ETH will very much outperform $BTC during the rest of this cycle. As of this this week, a significant line of resistance (the straight line in the chart) was broken, which means that it is $ETH’s time to shine.
What does this mean for the average investor? Well, if you have been dollar cost averaging (DCA-ing) money into $BTC, you might want to start allotting some of that money to $ETH. However, this really all depends on your investment time horizon (how long you plan to keep money in the market), so please make this decision for yourself. I am not a financial advisor. I suggest that you dive a little deeper on your own before making any changes to your portfolio or your investment strategy.
Best,
Frank
Twitter: @frankcorva
Just Watched: Thomas Sowell: Common Sense in a Senseless World (on Amazon Prime)
Currently Reading: How Crypto Billionaires Will Transform Philanthropy (Bloomberg)
