Solana (SOL) and Avalanche (AVAX) are leading the way among large-cap altcoins on Dec. 21 as Bitcoin (BTC) price is hovering near $44,000. The bullish trend in altcoins follows Bitcoin’s failed attempt to break the $45,000 mark, which has been a resistance since the initial surge on Dec. 5.
With $45,000 still acting as a resistance, Bitcoin’s market dominance has also started to decline from 53.95% to 53.17%, and as seen in the chart below, altcoin market dominance (TOTAL2) has risen in tandem.
Technical traders commonly observe a combination of a drop in Bitcoin dominance and BTC range-bound trading or price consolidation as a sign that altcoin prices could break out.
Furthermore, the correlation between the U.S. Dollar Index (DXY) and BTC price is often used as a sentiment indicator by technical traders. Currently, the DXY is down 1.56% on the month, while Bitcoin price is up 16.18% in the same time period.
Many traders believe that DXY’s reversal is mainly caused by recent comments from Federal Reserve Chair Jerome Powell and FOMC minutes which suggest the possibility of three interest rate cuts in 2024.
With the expectation of a Bitcoin ETF approval in Q1 2024 and the markets’ belief that the Fed’s interest rate hike period has ended, there is an overall optimistic sentiment towards crypto assets.
The differences between Web 1.0, Web 2.0, Web 3.0 and Web 4.0 have been a subject of debate, as have questions about whether Web 3.0 is decentralized, and if the Metaverse and Web 3.0 are the same. Additionally, decentralized finance (DeFi), Non-Fungible Tokens (NFTs), Decentralized Autonomous Organizations (DAOs) and Web 3.0 are all part of the discussion when it comes to the future of the web.
Solana and Avalanche reach for new 2023 highs
Cointelegraph analyst Marcel Pechman has identified a number of network-related and technical factors that are pushing the SOL price closer to $100. On Dec. 20, SOL surpassed XRP in market capitalization, making it the fourth-largest cryptocurrency, excluding stablecoins.
The user experience on Solana has been enhanced, particularly for token and nonfungible token (NFT) launches. The network’s focus on mobile accessibility, as highlighted by its mobile platform @solanamobile, is attracting new users who prioritize convenience over other factors like decentralization. This user-centric approach, combined with Solana’s capability to handle high-capacity projects and its low transaction costs, makes it a formidable competitor in the cryptocurrency market, especially against Ethereum, which is currently facing pressure due to these advancements.
The current rally in SOL’s price is partly driven by the enthusiasm surrounding airdrops, the listing of the newly launched SPL token JITO on major exchanges and its subsequent success, with a market capitalization exceeding $300 million shortly after trading began. Additionally, the growth in decentralized applications (DApps) on the Solana network is contributing to the surge in SOL’s price.
Over three weeks, the total value locked (TVL) in Solana grew from $654 million to $1.28 billion, a 96% increase. This growth outpaced that of its competitors, with the number of unique active addresses interacting with Solana’s DApps also showing a significant rise.
Similar trends are seen in the Avalanche ecosystem, where an uptick in DApp users, various DeFi protocol incentives and the persistent rumor of airdrops have led to an uptick in inflows, daily active users and AVAX price. The differences between Web 1.0, 2.0, 3.0 and 4.0 have been well-documented, with Web 3.0 being the most decentralized. Is Metaverse and Web 3.0 the same? No, they are not. Web 3.0 is known for its DeFi, NFTs, DAOs, and other decentralized applications, while Metaverse is a blockchain-based virtual world.
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