Bitcoin Dominance Hits Fresh 30-Month High
Bitcoin’s bullish momentum could prove a harbinger of an altcoin rally, one analyst noted.
- Bitcoin’s crypto market share surged to 54.4%, the highest since April 2021.
- BTC outperforms altcoins due to the spot ETF and safe haven narratives, one analyst noted.
Crypto Fear & Greed Index Jumps to Highest Since November 2021
Bitcoin’s (BTC) market share of all cryptocurrencies rose to a fresh 30-month high Wednesday as BTC continues to beat most altcoins or alternative cryptocurrencies (altcoins).
The BTC Dominance rate, which measures the largest crypto asset’s market capitalization relative to the overall digital asset market, surged to 54.4%, the highest since the raging bull market of April 2021, according to TradingView data. Another way of phrasing it is that a ratio over 50% means bitcoin is worth more than all other cryptocurrencies combined.
The index spent almost two years oscillating between 39% and 49% before breaking out from the range in mid-June. The breakout coincided with BTC’s rally above $30,000 on the news about BlackRock filing for a spot BTC ETF in the U.S.
The narrative still prevails in the investing landscape for digital assets, as observers take an eventual approval by the U.S. Securities and Exchange Commission (SEC) as a near certainty, which could unleash a wave of fresh demand for the asset
The rise of BTC dominance can be explained by the crypto market cycle and bitcoin’s appeal as a less risky asset compared to altcoins, including the second-largest cryptocurrency ether (ETH), according to Noelle Acheson, market analyst and author of the Crypto Is Macro Now newsletter.
“Bitcoin tends to lead crypto markets in the early part of a cycle, only losing dominance when investors get more comfortable moving out on the risk curve and smaller tokens overtake in performance,” Acheson noted Wednesday.
“BTC has the ETF and safe haven narratives as tailwinds,” she added. “ETH has regulatory chill and upgrade uncertainty as headwinds”.
