With bitcoin (BTC) hitting a new record price this week, above $109,000 (USD), demand for cryptocurrencies is growing. “Cryptocurrency prices currently fluctuate between 5% and 20% in a matter of minutes,” stressed the popular investor known as Jelle. “You guys better get used to it,” he says. “This is exactly the crazy market I talked about weeks ago,” notes Jelle. At the beginning of January, the investor had said that When this stage of cryptocurrencies occurs, some make a fortune and others end up losing everything. For this reason, he maintains that it is a moment in which everyone must play their cards well. As BitcoinDynamic reported, the memecoin that Donald Trump launched last weekend, before his presidential inauguration in the United States, is driving this scenario. Furthermore, the new government's intention to include bitcoin in national reserves and promote regulation in favor of cryptocurrencies fuels enthusiasm. “I didn't have a ton of Trump coins on the bingo card then, but the late-stage bull market is here,” says Jelle.
Cryptocurrency capitalization is in the previous strong rally zone
In terms of capitalization, The total bitcoin and cryptocurrency market remains above USD 3 trillion since a month ago. Until then, this figure was the historical record that had been set during the previous bullish cycle, in 2021. «In the previous cycle, the altcoin market began to run as if there were no tomorrow after the consolidation after this breakout. », highlights Jelle. This can be seen in the following graph.
Market capitalization of bitcoin and cryptocurrencies. Source: TradingView. In this sense, if this pattern is repeated, which reflects the entry of new demand into the market, cryptocurrency prices will continue to rise. Although, this does not mean that they will not have setbacks in the meantime, due to the high volatility that these assets comprise. With this context, Jelle warns that “things will move quickly in both directions,” either up or down. “Stay strong, take your profits and let's make this streak count,” he exclaims as a message to traders. Typically, after sustained bitcoin bull trends, Cryptocurrencies tend to experience periods of higher returns than BTC itself. This is due to their lower market capitalization, which makes their trading volumes trigger prices more easily. That is why this is an expected stage for high-risk traders looking for short-term profits. Although, it should be taken into account that, although bullish expectations currently reign, there is no guarantee that they will materialize. It all depends on supply and demand, after all. Additionally, due to altcoins' lack of fundamentals or strong use cases, their traders often take profits after big rallies. Some never recover afterwards, so it is key to consider the risks that come with this market.
