Bitcoin maximalist Samson Mow has mentioned that altcoin unit bias is destroying how new traders see the crypto market. According to the Jan3 CEO, Bitcoin’s dominance is yet to exhaust its upside trajectory after he analyzed how altcoin prices would stack up against Bitcoin if their supply were equal.
Mow’s recent forecast for a rise in Bitcoin dominance comes as the ratio has already exceeded the levels that most crypto analysts expected it to reach by late 2024. As at November 2024, Bitcoin dominance dropped to 56%, pushing analysts to predict an altcoin rally, which would see more investments ahead of January 20.
According to popular analyst Mikybull Crypto at the time, the market was officially in the altseason.
Mow says unit bias is destroying the uninitiated
According to his recent post on X, Mow mentioned that new traders are being swayed by the unit bias. “Most alts take advantage of unit bias by utilizing a very high supply, so people can’t figure out what they’re buying. ‘XRP is only $2 but Bitcoin is too expensive at $85,000!’. Unit bias is absolutely destroying the uninitiated,” he said.
In his post, Mow suggested that the unit bias, a psychological method in behavioral economics that suggests that individuals usually refer to a complete unit or stock regardless of its price and size, often causes less experienced investors to feel like altcoins are cheaper and offer better value for money than owning a part of an asset like Bitcoin.
He also questioned the value of altcoins on a level playing field. “You can buy one twenty-one millionth of the BTC supply for ~$85,000,” Mow said. He asked, “What happens if you remove unit bias from alts to calculate the equivalent of 1/21 million?” He added that according to their prices at the time of publication, Ethereum would be priced at $9,200, signifying a rise of 278,746%, XRP at $5,800, representing a rise of 470%, and Solana at $3,400, representing a rise of 2,327%. He added that there is no way that these altcoins are worth that much.
Bitcoin dominance exceeds analysts’ expectations
The same sentiment was shared by anonymous Bitcoin proponent, Sunny Po, who said on January 12 that “Unit bias is a core foundational framework of the normie mind. ‘Cheaper better.’” Mow added that most altcoins take advantage of this unit bias by implementing a high total supply so market participants can’t figure out what they are buying.
According to Mow, based on his calculations, Bitcoin dominance is going to go much higher. Bitcoin dominance is a metric that is usually used to measure the total share of the crypto market capitalization. Some traders also use it to determine how close Bitcoin is to nearing a price peak. According to previous years, when Bitcoin dominance drops, it presents the perfect opportunity for altcoins to thrive, with analysts often predicting that capital will shift from Bitcoin into altcoins as traders seek higher returns.
According to data from TradingView, Bitcoin dominance is presently sitting around 63%. Several analysts were expecting Bitcoin dominance to halt at 60% in 2024, as most of them expected the altcoin season to begin around that period. In August 2024, IntoTheCryptoverse founder Benjamin Cowen mentioned that his target for the asset was around 60%. “I don’t think it is going back up to 70%, my target for Bitcoin dominance has been 60%,” Cowen said.
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