All eyes should have been on Bitcoin as the king coin leapt past $51,000 and marked its highest price since mid-May. Yet, behavior analysis platform Santiment showed the Bitcoin discussion rate had dropped. The reason? Short-term traders were busy watching the trending alt coins.
📈 #Bitcoin closed out the weekend with a jump to $51,911, its highest price since May 12th. The rising interest on the more volatile and (mostly) higher gaining #altcoins has allowed $BTC to slowly & steadily grow as short-term traders #FOMO elsewhere. https://t.co/mnyKU7gjj8 pic.twitter.com/l3yR0Rq9f8
— Santiment (@santimentfeed) September 6, 2021
Solana’s dazzling rally as it crossed $100 and kept rising, mesmerized many traders. On the other hand, Bitcoin was struggling to break out and cross the $50,000 resistance.
Santiment also noted that Polygon [MATIC] and Cardano [ADA] were leading in the “rising topics” metric. Matic was the talk of town thanks to its 31% price rally in four days. Meanwhile, Ada was in the news due to the FUD after Cardano’s alleged testnet “failure.”
— Santiment (@santimentfeed) September 5, 2021
Fighting Human Nature
Fear of missing out (FOMO) can provoke investors to make dangerous financial choices or fall prey to pump-and-dump scammers. In this case, FOMO could have prompted traders to watch alt coins emerging in the space, after Santiment’s Bitcoin Weighted Sentiment value dropped below zero.
Another reason for the fresh eyes on alt coins could be influencers like Charles Hoskinson. Cardano’s founder has a strong social media presence and vocally responds to those he calls “FUDsters.” Coming to Matic, the Indian film studio Zee Studios launched its first NFT on Polygon. Such events also could have the potential to trigger crypto FOMO and attract short-term traders.
Seeing Bitcoin in Perspective
On 6 September, on-chain analyst Willy Woo tweeted the growth trajectory of Bitcoin and compared it to the growth of gold and stocks [M2 money]. When graphed on the same scale, the effect was stunning.
Here’s their growth trajectory on the same scale. pic.twitter.com/PKnTRui5uU
— Willy Woo (@woonomic) September 6, 2021
Woo’s analysis helped many put Bitcoin’s seemingly lethargic growth into perspective. Another analysis by him, using the supply shock valuation model, put the current price of Bitcoin above $55,000. Furthermore, Bitcoin stock-to-flow creator Plan B confirmed that his estimate of “$100K by Christmas” was still valid.
At press time, the price of Bitcoin was $51,838.52. The last update from the Bitcoin Fear and Greed Index recorded a value of 73, signaling “Greed.” As Bitcoin hodlers wait out the fall season, Santiment’s metrics suggested that more traders might be focusing on the alt coin market.