For the third or fourth day in a row, bulls have decisively taken control of the cryptocurrency market. Leading the pack wasn’t Bitcoin or Ethereum (ETH), it was XRP, the third-largest cryptocurrency by market capitalization and an asset that is either despised or loved.
As reported by NewsBTC previously, the Ripple-linked token surged on Monday, rallying as high as 12% and tapping $0.22 as buyers stepped in en-masse. For some perspective, Bitcoin gained a mere 6% on Monday, tapping $8,000 in an amazing surge higher.
While the momentum has paused for XRP, analysts are saying that the asset’s rally could be bullish for Ethereum and other major cryptocurrencies.
Ethereum Getting Ready to Jump Higher
Cryptocurrency trader Hsaka noted that XRP’s double-digit daily candle, something that “we haven’t seen in a long while,” is likely a sign that “other majors” (meaning other leading altcoins such as Ethereum and Litecoin) will soon see a similar trend of posting jaw-dropping gains in a single trading session.
$XRP flexing with a double digit daily candle, something we haven’t seen in a long while.
Question is, if this is an outlier, or an indication of what lies ahead of other majors.
My money’s on the latter. pic.twitter.com/uZyh76zvnM
— Hsaka (@HsakaTrades) January 6, 2020
That’s far from the end of it.
Below is a chart from prominent cryptocurrency trader Dave the Wave — an analyst who called Bitcoin’s decline to the $6,000s when BTC was trading above $10,000. It the chart, the pseudonymous trader is depicting that the aggregate market capitalization of all altcoins has bounced off a key logarithmic support, partially due to XRP’s strong uptick, and is thus poised to rally higher into 2020 and beyond.
Not to mention, the Relative Strength Index of this metric has formed a double bottom just as it did in a previous market cycle, implying a strong breakout to the upside in the coming months.
— dave the wave (@davthewave) January 6, 2020
This means that altcoins, including everything from Ethereum and Litecoin to XRP and XLM could have legs to move higher from here.
Also, per previous reports from this very outlet, January for three out of the four past years has historically marked the start of “every major” rally for ETH. Just look to the chart below, which shows that each January triggered massive swings to the upside in the past; in 2017, for instance, January marked the start of a rally that brought ETH from $7 to $1,400 by the first quarter of the next year.
If you look at $ETH on a log scale every major run up has started in January (3 out of 4 years).
Could be tax related (harvest losses in December and rebuy in new year), or could be mere coincidence.
Either way, I’ve got my🍿 pic.twitter.com/WPth8xIlDp
— Feebs (@fiebsy) December 31, 2019
But Wait, There’s More
All this has been corroborated by fundamental trends.
Most notably, 2019 was the year that ETH gained its first killer use case: decentralized finance, better known as “DeFi.” According to Ethereum statistics website DeFi Pulse, there is $667.3 million worth of digital asset value — including just under three million Ether — locked in DeFi applications on the blockchain, which is up from approximately $240 million in January of this year.
The cryptocurrency also saw notable adoption by institutions, with Fidelity Investments — the financial services and investment giant with over $2 trillion worth of assets under management — announcing intentions to add the altcoin and firms like Santander and E&Y using ETH technology to bolster their bottom lines.
Featured Image from Shutterstock