The price of Bitcoin (BTC) has stabilized at around $40K, the middle of a three-month price range. The cryptocurrency is expected to drop 15% this month, however other analysts predict a temporary relief rally, similar to what happened in late February and early March.
On Friday, most cryptocurrencies were mixed, showing traders’ skepticism. Ethereum (ETH), the second-largest cryptocurrency by market capitalization, is likewise trading at the $3000 middle of its three-month price range. So far this month, ETH has dropped 13%, compared to an 11% decline in Solana’s SOL token and a 4% drop in DOGE.
Newly Minted Altcoin Fail To Perform
According to a recent study conducted by Jump Crypto, the vast majority of newly minted coins have underperformed Bitcoin over the past year. Bitcoin is the world’s largest cryptocurrency.
According to Bloomberg, the firm evaluated the performance of over 3,700 tokens and discovered that a whopping 80% of them are losing money in comparison to the crypto monarch.
“The market for new tokens looks surprisingly efficient, in that returns are neither systematic nor predictable,” Jump said
The astonishing findings contradict many who argue that investing in Bitcoin is risky due to its enormous market capitalization. While there are a few jewels that have outperformed Bitcoin, the great majority of newly issued cryptocurrencies are either outright scams or tokens with no discernible utility.
Notably, the firm has shown that altcoins do not perform significantly better in bull markets, which is perhaps the most surprising finding from Jump Trading’s research. This indicates that, despite its chaos, the cryptocurrency market is actually efficient.
Despite the fact that cryptocurrencies such as Dogecoin, Solana, Shiba Inu, and Cardano made headlines in 2021, they continue to underperform this year owing to risk aversion.
In the crypto market, macroeconomic uncertainty is front and center, with the Federal Reserve’s rate hikes acting as a crucial bearish stimulus.