Formerly known as Bitcoin Cash ABC (BCHA), now rebranded as eCash (XEC), this cryptocurrency aims to fulfill its original purpose of replacing traditional money and serving as electronic cash.
On the other hand, Blockstack, now simply known as Stacks, strives to bring decentralized apps to the Bitcoin network while leveraging its security without compromising or expanding its network capabilities.
Both eCash and Stacks, closely tied to Bitcoin, have witnessed significant price surges in the past two days, making them standout performers over the last week according to Coingecko data.
In this analysis, we will delve into their similarities, conduct a comparative analysis, and also examine Bitcoin’s price trends to uncover the reasons behind these price fluctuations.
The comparison chart between eCash and STX reveals a strong correlation, not only over the last seven days but in their overall price movements. While eCash experienced a higher spike, it followed a similar pattern to STX since September 11.
Both eCash and STX followed a similar pattern: starting with a new low, then a climb to the mid-range of their recent sideways movements, followed by a higher low before a strong upward spike. eCash surged above its previous high of $0.000025, reaching $0.000027 recently.
In contrast, STX has yet to reach its August 30 high of $0.53, only reaching $0.49 recently. However, STX has shown signs of progress today, surpassing yesterday’s high, while eCash remains below it.
This suggests that eCash may be acting as a leading indicator for STX, potentially signaling another rise for both coins, with STX possibly experiencing a more immediate one.
When examining the Bitcoin chart in conjunction with those of XEC and STX, it becomes evident that the rise in these coins is closely tied to the increase in Bitcoin’s price and their significant reliance on its performance.
They aren’t as strongly correlated to Bitcoin as they are together. We can see that Bitcoin’s price didn’t make a sharp downturn from September 16 to 18 before spiking, instead, it made a steady rise.
The price correlation can also be seen to be present in the past, especially around August 30 when the prices spiked but fell back quickly which was led by the Grayscale against SEC court decision to reevaluate the ETF approval.
“With Bitcoin dominance surpassing 50% and maintaining an upward trend since September 2022, it raises the question of whether altcoins closely associated with Bitcoin will outperform other assets in the near future.
The answer hinges on whether Bitcoin’s dominance continues to rise or experiences a reversal. Given that it has been steadily increasing since August 20, rebounding from 48% to breach the 50% mark once more, it is likely to persist in its ascent in the forthcoming period.
Looking at the individual fundamentals of the projects, there are reasons for this bullish price action. eCash has been surrounded with excitement about the PayButton launch which was seen by over 30,000 people.
In the STX ecosystem, there is excitement around the recent development of sBTC a system that will allow users to borrow BTC natively and use it in DeFi products without relying on a wrapped counterpart.
As Bitcoin’s dominance surpasses 50% and continues its upward trajectory since September 2022, it prompts speculation about whether altcoins closely linked to Bitcoin will outshine other assets in the near term.
The outcome largely depends on whether Bitcoin’s dominance sustains its ascent or undergoes a reversal. Considering its steady rise since August 20, rebounding from 48% to re-enter the 50% territory, the likelihood is that it will persist in its upward trend in the coming period.
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.