Bitrabo Editorial
Data reveals that Bitcoin dominance has reached 47.6% as investors are shifting their focus from altcoins to BTC.
Bitcoin Dominance Sees 7.6% Rise Since the Beginning of 2023
According to on-chain analytics firm Glassnode, altcoins are consistently being converted into the original cryptocurrency. The term “dominance” refers to the percentage of the total cryptocurrency market cap that is attributed to Bitcoin alone.
An increase in this metric indicates that the market share of Bitcoin is currently growing. This trend suggests that investors prefer investing in Bitcoin over other altcoins.
Conversely, a decrease in the indicator suggests a decline in interest from holders as the market caps of other coins increase.
Here is a chart displaying the trend in Bitcoin dominance over the past few years:
The value of the metric seems to have been going up in recent days | Source: Glassnode on Twitter
As shown in the chart above, Bitcoin dominance has steadily increased since the start of 2023 and the subsequent market rally. It appears that with the ongoing price appreciation, investors saw Bitcoin as the most promising asset.
In recent weeks, however, the upward trend in the indicator has plateaued, indicating a lack of new investment compared to the rest of the market. This occurred as the price rally slowed down and the coin began to decline.
Recently, Bitcoin experienced a further drop in value after the US Federal Reserve announced that interest rate hikes would continue to combat inflation. However, the increase has currently paused.
Bitcoin’s reaction to this news has been mirrored by the rest of the market, which has also seen a decline. Nevertheless, the chart above indicates that Bitcoin’s dominance has increased despite the recent negative price action.
This suggests that while capital may be exiting the market as a whole, Bitcoin has performed better than altcoins, as some investors have been shifting their funds from altcoins to Bitcoin, likely believing that Bitcoin is a safer investment during the sector’s current challenges.
The cryptocurrency’s dominance has now reached 47.6%, signifying a year-to-date increase of 7.6% in this metric.
Bitcoin Price
At the time of writing, Bitcoin is being traded at around $25,100, which is a 5% drop within the last week.
Looks like the value of the metric has plunged recently | Source: BTCUSD on TradingView
Featured image from André François McKenzie on Unsplash.com, charts from TradingView.com, Glassnode.com