The proportion of Bitcoin in the cryptocurrency market has reached 42.74% as of Wednesday, the highest in the last two and a half months.
As reported by CoinMarketCap, the market share was the highest since April 14, signalling that more investors have been deviating their inputs towards the industry’s largest traded asset instead of the alternatives.
CoinMarketCap’s Dominance Index is a marker that records the major cryptocurrencies’ share by percentage of the total market cap. A gaining rate of dominance clearly signifies that the demand for Bitcoin is much larger than the interest in other competing alternate cryptos.
Bitcoin is a common route for fiat currency to enter into the market. A trending flow towards Bitcoin is hence a regular sight at the start of a bull run.
The dominance rate for Bitcoin also rose from 38% to 66.5% in the semester leading up to the massively eventful December of 2017. The coin raced up to $20,000 during this time, starting out at $1,760.
Another point of concern could be the suggestive statistic that the market share often rises during periods of risk aversion. Investors tend to switch from high-risk altcoins to Bitcoin, and then eventually onto fiat currency.
Experts suggest that it is most probably the latter scenario that we’re witnessing as of now. BTC has crashed down more than four thousand dollars in the last 7 weeks, and yet the dominance rate of BTC has gone from 35.78% to 42.75%.
It would seem that the crypto markets may have bottomed out if prices start to rally along with the BTC dominance rate.