- Bitcoin Dominance measures BTC‘s influence over the crypto market.
- Bitcoin Dominance surged to a nine-week high on Tuesday.
- A major sell-off has battered the market this past week, with altcoin prices plunging.
Bitcoin Dominance is a key metric that refers to the proportion of Bitcoin’s market cap compared to the entire crypto market. This indicator serves as a crucial gauge of Bitcoin’s relative size and influence within the broader digital asset ecosystem.
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A high Bitcoin dominance suggests altcoins are losing market share as investors seek the perceived safety of BTC. Amid a significant crypto market sell-off, Bitcoin dominance reached a nine-week high on June 18, highlighting this flight to safety during market turmoil.
Bitcoin Dominance Jumps to Nine-Week High
Bitcoin dominance surged on Tuesday, reaching a nine-week high of 56.5% of the total crypto market cap. This spike occurred amid mounting sell pressure and a broader market-wide sell-off, with $110 billion in capital exiting the market over the past week.
The uptrend in Bitcoin Dominance has been gaining momentum since hitting a local bottom of 53.7% on May 29. This trajectory accelerated on June 17 as weekend losses spilled over into the new week, further fueling the dominance of the world’s largest cryptocurrency.
While the short-term trend favors Bitcoin, some analysts remain optimistic about the prospects of altcoins. Trader Jelle, taking a multi-year perspective on BTC.D, stated that Bitcoin Dominance “continues to lose steam,” suggesting that altcoins will outperform once Bitcoin breaks its previous all-time high.
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However, even the most bullish investors would find it challenging to build a case for Bitcoin breaching its previous $74,000 record in the near term as markets sink lower.
Crypto Markets in Turmoil
The plunging crypto market has inflicted significant losses, with the total market capitalization shedding a staggering $110 billion over the past week. Amidst this turmoil, Bitcoin experienced a relatively modest 3% decline, indicating that altcoins shouldered the brunt of the outflows from the broader market cap.
The impact on altcoins has been severe, with some projects suffering substantial losses. The biggest casualties over the past week include Akash Network, Floki, and Chiliz, which plummeted by 33%, 32.8%, and 32.8%, respectively, during this period.
Nonetheless, Bitcoin finds itself trading within the key support zone of $64,500. While the leading cryptocurrency has been on a downward trajectory since reaching $72,000 on June 7, the current price action suggests that the momentum is with the bears.
On the Flipside
- As crypto markets bleed, tech stocks have posted their seventh consecutive day of gains.
- Crypto market volatility can lead to sudden reversals in either direction.
- The Fear & Greed Index is up 3 points to 74, suggesting market sentiment remains buoyant despite the sell-off.
Why This Matters
The rise in Bitcoin Dominance amid market turbulence underscores BTC’s perceived role as a safe haven within the crypto ecosystem.
Bitcoin’s dip stirs concerns of further drops ahead:
Bitcoin Price Stumbles at $70K Again as Calls for $48K Arise
Tether announces its new “tethered asset” aUSD₮ token, backed by Tether Gold:
Tether Unveils Gold-Backed “Alloy”: What You Need to Know
