- Bitcoin has been the largest mover in October.
- Bitcoin’s growing demand and adoption influenced its resurgence.
- Ethereum 2.0 will have a positive impact on ETH and other Ethereum-based tokens.
- Many DeFi tokens are struggling while Bitcoin’s price is recovering.
- DeFi’s long-term potential and investors’ interest continue to persist.
Bitcoin consistently showed good performance since October. In fact, a Binance report highlighted BTC gains of more than 27% last month. On the other hand, DeFi and altcoin markets have recorded modest gains.
Bitcoin’s breakout above $12,000
Without a doubt, Bitcoin has been the largest mover in October. For the first time since 2018, the BTC price crossed above $13,000. It continued to rise amid the US election and now trading at a price of over $15,000.
Bitcoin’s growing demand and adoption greatly influenced its resurgence. In particular, large fintech businesses such as MicroStrategy, Square, and Grayscale Investments have announced their purchase of Bitcoin. In addition, Paypal and Singapore’s DBS Bank plans to offer crypto services were contributing factors to BTC’s growth as well.
Moreover, Bitcoin’s volume dominance surged above 50% since its bullish trend. Traders completely reversed the market sentiment in favor of Bitcoin in October. More so, the Bitcoin futures market went beyond $3.65 billion as BTC broke the $12,000 resistance level. Hence, Bitcoin has taken over the altcoin season.
Ethereum 2.0 to boost Ethereum and altcoins
Altcoins had an underwhelming month amid Bitcoin’s rally. Binance report mentioned that large-cap cryptocurrencies such as ETH, XRP, BCH, LTC, and LINK failed to break new highs. This is a result of trading activities shifting to BTC.
Despite that, ETH price action is set around $440, as of this writing, surging more than 10% following an announcement on its ETH 2.0 upgrade. To clarify, Phase zero, or the first transition stage of the Ethereum network, is scheduled for December 1.
Ethereum 2.0 will have a positive impact on ETH and other Ethereum-based tokens. By changing to as Proof-of-Stake (PoS) consensus, Ethereum will allow ETH staking. This will then reduce the supply of ETH tokens and ideally increase the crypto’s demand in time.
DeFi’s bubble hold out
Furthermore, many DeFi tokens are struggling while Bitcoin’s price is recovering. Thus, Binance analysts have identified a negative correlation between DeFi tokens and BTC.
Unsurprisingly, DeFi’s negative correlation with BTC as well as ETH is a result of DeFi’s hype fading. Despite the massive price setback in DeFi tokens, the sector’s underlying fundamentals remained stable.
Generally speaking, the total value locked (TVL) has maintained a foothold above $12 billion. Over half of the overall TVL are invested in Uniswap, Maker, and Wrapped Bitcoin. For this reason, despite its hype dying down, DeFi’s long-term potential and investors’ interest continue to persist.