Justification to trust
Rigorous editorial guidelines emphasizing precision, significance, and neutrality
Developed by field professionals and thoroughly vetted
The utmost standards in journalism and dissemination
Rigorous editorial guidelines emphasizing precision, significance, and neutrality
Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.
Cryptocurrency values are beginning to navigate through a phase of gradual yet consistent advancements over the last 48 hours, with Bitcoin once more taking the lead while most altcoins trail in recovery efforts. In a recent message on the X platform, notable Bitcoin maximalist and JAN3’s CEO, Samson Mow, elucidated the deceptive nature of unit bias in relation to altcoins.
According to Mow, prices of $9,200 for Ethereum, $5,800 for XRP, and $3,400 for Solana are virtually unfeasible based on the existing supply of those tokens.
Unit Bias And Market Capitalization: The Data Speak Clearly
Mow’s message on X questions how investors evaluate the worth of altcoins such as Ethereum, XRP, and Solana. He suggested reshaping altcoin valuations by using Bitcoin’s supply model as a reference. Bitcoin was designed with a maximum circulating supply of 21 million units, of which 19.85 million are currently in circulation.
Related Reading
At this moment, one unit of 21 million Bitcoins is valued at around $88,000. This cost may be prohibitively high for retail traders. Therefore, owning a complete unit of XRP or Solana appears more attainable for newcomers and retail traders in contrast to purchasing a fraction of Bitcoin with the same amount of investment.
To illustrate how misleading this belief can be, Mow reimagines altcoin valuations by dividing their total market capitalizations by Bitcoin’s 21 million supply cap. This essentially questions the price of a single unit of these assets if they possessed the same supply scarcity as Bitcoin. Given present market capitalizations, Ethereum would be assessed at approximately $9,200, XRP at $5,800, and Solana at $3,400.
In light of the current valuations of Ethereum, Solana, and XRP, these numbers are implausible, highlighting how much of the appeal of altcoins is fueled by unit bias rather than genuine value. Additionally, it reveals that Bitcoin possesses superior fundamentals and scarcity within its supply dynamics.
The Bitcoin Dominance Narrative Gaining Momentum
For Mow and other Bitcoin maximalists, the difference in Bitcoin supply compared to prominent altcoins is yet another justification for the expectation that Bitcoin dominance will strengthen over time. Importantly, the influx into spot Bitcoin ETFs and the increasing acceptance among traditional finance investors bolster the argument for Bitcoin’s growing prominence in the future.
Related Reading
It is worth noting that Mow’s viewpoint contrasts with the predictions of certain analysts who still foresee an emerging altcoin season. These analysts contend that Bitcoin dominance, even while currently at a yearly high of 63.5%, might be on the brink of a reversal. One prominent technical analysis even forecasted a significant decline in dominance toward the 40% level in the upcoming months.
At present, Bitcoin is valued at $88,530, showing a 1.3% increase in the last 24 hours. Ethereum trades at $1,620, reflecting a 1.5% decrease over the same timeframe. Solana has fallen 0.5% to $140, and XRP is priced at $2.09 after a decline of 1.63% in the past day.
Featured image from Pixabay, chart from Tradingview.com
