Bitcoin Dominance Remains High As Market Sell-Offs Settle


Bitcoin’s dominance in the market hasn’t diminished even as the price drops below $30,000. Just as BTC has had success, so too have altcoins. This gave the leading cryptocurrencies more room to conquer the market dominance. Although the market was tough for investors in the past week, it is starting to stabilize, and towards the end of the month, indicators are starting to point to better forecasts.

Bitcoin is still on the upside

With Bitcoin, there has been no dispute over its dominance in the crypto space. However, this dominance has been waning since then with the increase in digital assets. Cryptocurrencies like Ethereum were expected to continue gaining more market share but this did not prove to be the case.

Related reading | Market sentiment is seriously negative as Crypto Fear Index drops to two-year low

Instead, what has happened is that Bitcoin’s dominance has returned to its highest level in seven months. It currently sits above 46% and the last time domination was at that high was in October 2021 after the September crash.

This dominance is also evident in the performance of the digital asset compared to other indices in the space. May hit all indexes hard with double digit losses across the board, but BTC has held up better than its peers.

Bitcoin Dominance Chart from TradingView.com

BTC dominance recovers above 45% | Source: Market Cap BTC Dominance on TradingView.com

For the month of May, the price of Bitcoin fell by 24%, which is a significant drop. But the performance of small, medium and large capital indices was worse. The index of large companies is down 27% since the beginning of the month and the index of medium companies is down 31%. In the true small caps index fashion when the market is in a downtrend, it has recorded the most losses with a decline of 37% since the beginning of the month.

Altcoins don’t look so hot

The altcoin market is a market that attracts investors due to the fact that it holds great promise for maximum returns. This market has been booming during the bull run. But just as they are likely to rise during bull markets, they are also likely to incur the most losses during heavy market selling. This has been true so far in recent months. While Bitcoin has managed to hold more than 40% of its all-time high value, not many altcoins can say the same.

Bitcoin Index

BTC outperforms other indexes | Source: Arcane Research

An example is Cardano. The ADA recorded one of the biggest gains during the 2021 bull market, but it was also one of the hardest hit cryptocurrencies in the bear market. Since it reached an all-time high of $3.10 in September, it has since lost more than 84% of its value.

Related reading | Bitcoin on-chain activity throttled after LUNA crash

Dogecoin, the investor’s favorite currency, is down more than 89% from its all-time high. Solana’s stock is down more than 80%. Compared to these, Bitcoin has been one of the top performers in the market, which explains why its dominance continues to grow.

Featured image from The Washington Independent, charts from Arcane Research and TradingView.com

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