With a market valuation of almost $520 billion and a current price of $26,690, Bitcoin has reclaimed the limelight. It now accounts for more than half of the entire cryptocurrency market.
This turning point is important because it occurs at a time when many alternative cryptocurrencies are stagnating or declining. It’s worth noting, though, that Bitcoin is still nearly 5% lower than its June high and 23% below than its January 2022 peak, despite the recent uptick.
Looking at the market more broadly, the alpha coin’s market dominance ranged between nearly 40% and 49% for more than two years before it finally reached the 52% level in June, when asset manager BlackRock’s application for a spot BTC exchange-traded fund sparked expectations about releasing significant inflows into the asset class.
Bitcoin Might In A Volatile Crypto Landscape
Whale interest in Bitcoin was also increasing. The number of addresses with sizable cryptocurrency holdings hit new highs. Both good and negative market effects may result from this trend.
Source: Statista
A crucial crypto indicator, the “dominance” ratio of BTC assesses its strength by comparing its market value to that of the entire crypto market. Early in 2022, Bitcoin’s market share exceeded 50%, but it declined in the summer as altcoins like NFTs and DeFi grew in value.
Dominance is significant because it can capture changes in market value, which can occur quickly as a result of changes in price or trade volume. It demonstrates how crypto investors are responding to current affairs and demonstrates whether BTC is losing ground to stablecoins or NFT tokens.
BTCUSD approaching the key $27K territory today. Chart: TradingView.com
The cryptocurrency market is currently experiencing a significant liquidity shortage, as Bitcoin’s absence of potential upward movement continues to disappoint investors. The top crypto saw a rapid retracement following a 2% increase in value last night, as it failed to sustain support at the $26,000 level.
Staying Resilient And Popular
Despite this, Bitcoin has demonstrated its propensity to see significant increases during periods of market downturns. It continues to be the leading and most recognized digital currency.
Meanwhile, investors are getting ready for a possible drop in Bitcoin’s value in September, a historically tough month for the cryptocurrency. This cautious outlook is reinforced by the rising chances of a global economic downturn and stubbornly high inflation.
However, some analysts believe that BTC could see a major price increase, often called a bull rally, because of an expected influx of new investment. This surge could help Bitcoin sustain its dominance in the highly-stacked crypto market.
Featured image from Live Bitcoin News