The broader market is following in the footsteps of Bitcoin and Ethereum. But which of the two paved the way? Is the king mint leading the proceedings or has the alt king assumed the responsibility?
To answer that, let’s analyze the state of some volatility and dominance oriented metrics.
Ethereum Rises to Opportunity
The volatility spread realized by ETH-BTC had risen in recent weeks. Essentially, this means that the volatility of the Ethereum market has escalated compared to Bitcoin. In simpler terms, the alt king’s price movements are more amplified than the king’s coin.
In addition, implied volatility has also increased. While a brief downward trend was noted in June, this stat managed to bounce back solidly. The IV was at its 6-month high at press time, indicating that traders continue to expect Ethereum to lead the show.
From May 17 to June 15, when ETH-BTC IV rose to create a local spike, Ethereum and Bitcoin even recorded downswings. However, the first made more losses [52%] compared to the previous one [35%]†
In fact, on most occasions in the recent past, whenever spreads have risen to create highs, Ethereum has held the torch.
Furthermore, data from TradingView revealed that Bitcoin’s dominance has shrunk by more than 10% compared to the local peak of mid-June. It tried to recover by the end of June but failed.
Whenever Bitcoin’s dominance falls, it doesn’t necessarily mean the asset’s price is falling, and simply indicates Bitcoin’s diminished say in the overall state of the market.
influence on alt
Right now, most top alts share a higher correlation with Bitcoin than Ethereum. For their part, Bitcoin and Ethereum share a relatively low correlation of 0.13. This means that the alt pack is set up to replicate Ethereum’s price actions in the near term and not necessarily pay attention to Bitcoin.
