Altcoins
Bitcoin Dominance At Three-Year High, But Altcoins Could Rebound, Analysts Say
Bitcoin Dominance At Three-Year High, But Altcoins Could Rebound, Analysts Say
BitcoinBitcoin’s market cap now accounts for over 55.05% of the total market share, its highest level in three years. According to CoinMarketCap, Bitcoin’s market cap has climbed to $1.27 trillion. In comparison, the entire cryptocurrency market is valued at $2.43 trillion, with Ethereum accounting for 16.5% of the market at $389 billion.
Bitcoin’s rise this year has been somewhat unexpected. Altcoins typically outperform Bitcoin during bull markets. While memes saw a resurgence earlier this year when Bitcoin hit new all-time highs, other cryptocurrencies haven’t benefited as much from what’s known as the “wealth effect.”
Meltem Demirors, former chief strategy officer at CoinShares, highlighted on Twitter a key factor influencing this shift: “ETF flows are fundamentally changing market dynamics. BTC gains are no longer translating into altcoins and the longer tail of crypto assets.”
Bitcoin dominance has continued to grow despite the growing market cap of Tether (USDT), the world’s largest stablecoin and the third-largest cryptocurrency after Bitcoin and Ethereum. Stablecoins, which are backed by fiat currencies, are often excluded from Bitcoin dominance metrics due to their different value models.
Despite the disappointing performance of altcoins, there is some optimism about their potential resurgence. CryptoQuant CEO Ki Young Ju noted on Tuesday that whales are preparing for the next altcoin rally, as there has been an increase in limit buy orders for non-Bitcoin and non-Ethereum assets.
Ki Young Ju shared a chart showing that the cumulative buy-sell volume difference has been rising for several months. This indicator measures the difference between buy and sell orders over a year, creating resistance and support levels. When the trend is up, it indicates that more people are placing buy orders, reflecting strong buying interest.