The market value of cryptocurrencies has reached a peak of 262% so far this year. The dominance of bitcoin fell from 69.71% in early January to 54.44%.
According to the leading price portals of this market, cryptocurrencies’ total market capitalization is above USD 2 trillion. CoinMarketCap reflects a cryptocurrency market capitalization of $ 2.207 trillion, while Coingecko shows a total value of that market of $ 2.285 trillion.
The difference of 3.5% between these two portals could happen because Coingecko processes data in real-time from 449 exchanges, while CoinMarketCap works with data from 366 exchanges.
While this is a minimal discrepancy, the $ 2 trillion milestones in cryptocurrency market capitalization affected Coingecko first instead CoinMarketCap. In the latter, the arrival of 2 trillion appeared this Tuesday, April 13, while Coingecko had indicated the surpassing of that mark on April 8.
Bitcoin Dominance Seems to be Falling down
In the last two years, bitcoin dominance in the cryptocurrency market has been predominantly above 60%. Dominance approached at least 70% at the beginning of 2021, but the authority has been steadily declining since that local peak.
In parallel to the loss of its dominance, bitcoin shows a growing lag when its appreciation is measured in the group of the top 50 cryptocurrencies by market capitalization. On two occasions in 2021, bitcoin has been in the last place in the mentioned group.
According to the so-called altcoin index, the market is in “altcoin season.” This event occurs when in the appreciation positioning in the last 90 days, bitcoin is 38th out of 50, or lower.
Even though bitcoin shows an appreciation of 63.1% in the last three months, only four cryptocurrencies out of 50 have worse performance. The remaining 45 cryptocurrencies have outperformed BTC in the indicated period. 41 out of 50 cryptocurrencies show returns above 100% in 90 days.
What Is Affecting Bitcoin’s Dominance that Much?
Several entities argue against Bitcoin’s dominance and have seen the fact that the market should find more balance rather than having one cryptocurrency dominating the others. When Bitcoin pulls back, altcoins do the same, but many times when BTC recovers, altcoins cannot catch up as Bitcoin’s rebound seems to frustrate their recovery.
Bitcoin’s dominance overshadows the promising projects that investors usually consider. This shadowing, in turn, frustrates the development and introduction of new cryptocurrencies that could serve as alternate investments, some of which are even potentially better than BTC. In other words, Bitcoin reduces investors’ greed and makes them prioritize safety.
Even with Bitcoin dominating the crypto market, altcoins have found uses in several different areas, despite their low price growth.
Ethereum is an excellent example of this phenomenon. Ethereum is famous because it allows the creation of smart contracts and Dapps and EOS and others. Some of them are game DApps that serve as tools for gambling.
By: Jenson Nuñez
