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Daily Bitcoin and Crypto Analysis

Daily BTC Analysis

November 11, 2020
The flow of capital in traditional finance, as a rule of thumb, works like this: Risk off, money flows from stocks to bonds, and risk on: Money flow from bonds to stocks. It’s a simple model. Everything good in the economy? Great, let’s buy stocks and leave the low yielding bonds to a smaller percentage of our portfolios. Only, money is now so cheap that bonds no longer pay you a return on your capital investment. They now charge you for the pleasure of assuming the risk on their debt. That, in a word, is madness. But there we are, ‘money printer go brrrr’, bonds going to negative yields, and stocks going up because no one really likes to lose money on purpose, so they decide stocks are worth the gamble.

So how does this translate into a crypto-world? Last week we saw the alternation of capital between alts, defi, and Bitcoin. Bitcoin led the way, as the also-rans refused to go up. It was a few days before things started to move. Holders of alts were selling into the general market bid and jumping back on the Bitcoin train. Bitcoin duly rallied, hit a new multi-year high, and stalled. Alts on the other hand, buoyed by the euphoria of the Bitcoin headlines, began to lift and have carried on outperforming Bitcoin since that high was placed on Saturday.

Did the smart money simply shift back into the more volatile alts once the Bitcoin move was done?

Given it’s the best performing asset of 2020, it’s difficulty to suggest that Bitcoin is the bond of the crypto world. It’s the blue chip, mega-asset of the cryptocurrency world. They say a rising tide lifts all boats, but Bitcoin is more like a hungry, gigantic sea-monster, coming up for food and air…

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