Research Summary
The report provides a comprehensive analysis of the week’s cryptocurrency market trends, focusing on Bitcoin ($BTC), Ethereum ($ETH), Solana ($SOL), and other altcoins. It also discusses the performance of crypto-related stocks, the impact of ETF announcements, and the potential of various alt L1 coins.
Key Takeaways
Bitcoin’s Market Stability
- Bitcoin’s Steady Range: The report notes that Bitcoin has remained stable within the $41k-$44k range, with no significant movements. Despite this, altcoins have been generally increasing.
- ETF Announcement Impact: There is speculation about a potential sell-off following the ETF announcement in early January. However, the report suggests that the more Bitcoin’s value decreases before the ETF announcement, the less likely a sell-off will occur.
Ethereum’s Performance and Potential
- Ethereum’s Recent Gains: Ethereum has seen a significant increase, with related coins such as $OP and $ARB also performing well. Over one week, despite a recent dump, these coins have shown strong performance.
- Future Prospects for Ethereum: With EIP-4844 planned for February 2024, the report suggests that the Ethereum L2 trade could still be a good play going into 2024.
Solana’s Market Dominance
- Solana’s Market Cap Growth: Solana has seen a significant increase in its market cap, moving from around $90 to close to $125. This represents a local top at $53bn market cap, a significant increase from $8bn three months ago.
- Solana Ecosystem Performance: Despite Solana’s performance, most of the Solana ecosystem coins did not act as beta coins for $SOL. The best performer in the Solana ecosystem this week has been $NEON.
Alt L1 Coins’ Performance
- Alt L1 Coins’ Rally: The report notes that Solana’s run ignited a whole alt L1 pump, with $NEAR being the strongest performer, doing almost 2x in a week.
- BNB’s Recovery: Binance Coin ($BNB) has finally had a reaction against Bitcoin, up +44% in December. $CAKE, the direct BNB beta coin, is also up more than +40% this week.
ZK Narrative and Polkadot Ecosystem
- ZK Narrative: $MINA, the only zk L1 that people really know about, was among the best performers this week with a +40% increase.
- Polkadot Ecosystem: The report notes that even the alt L1 $DOT, which has been a massive underperformer during the bear market, managed to be +16% up this week.
Actionable Insights
- Monitor Bitcoin’s Stability: Given Bitcoin’s current stability, it may be beneficial to monitor its performance closely, especially in light of the upcoming ETF announcement.
- Consider Ethereum’s Potential: With Ethereum’s recent gains and the upcoming EIP-4844, it may be worth considering the potential of Ethereum and related coins.
- Assess Solana’s Market Dominance: Solana’s significant market cap growth and the performance of its ecosystem coins may warrant further assessment.
- Explore Alt L1 Coins: The recent rally of alt L1 coins, particularly $NEAR and $BNB, suggests that these coins may be worth exploring further.
- Understand ZK Narrative and Polkadot Ecosystem: The performance of $MINA and the Polkadot ecosystem may provide insights into the potential of the ZK narrative and the Polkadot ecosystem.
