The beginning of the year 2023 has impacted positively on cryptocurrencies, especially the last one week . During this time the majority of cryptocurrencies like Bitcoin, Ethereum, BNB, Cardano and other altcoins have remained bullish. Currently, in the last 24hrs Bitcoin has gained 4.05% while Ethereum has surged 4.87%.
However, it’s been observed that altcoin dominance has now hit its highest level while that of Bitcoin’s has slipped to its lowest level. CryptoQuant analyst claims that Bitcoin dominance has dropped to 16%.
Altcoin’s Dominance Surge Against That Of Bitcoin
The dominance by volume is an indicator which measures the total crypto market trading volume which is shared by one particular currency. If this indicator rises for any crypto it suggests that the currency is currently seeing high activity compared to other currencies. On the contrary, if the dominance decreases it means that the particular coin is losing interest among its investors.
The below graph represents the dominance by volume of Bitcoin and altcoins (except Ethereum) in the last few years. By this graph we can clearly learn that Bitcoin’s dominance by volume has plunged to hit 16% which is the lowest in the last two years.
However, the altcoins dominance by volume has surged a whopping 64%. This claims that Bitcoin has lost its market share to altcoins.
CryptoQuant has marked this phenomenon as a not so good event as whenever altcoins have surged the bulls have not held up well resulting in a massive fall. The firm gives an example of the 2021 bull run which took place when altcoins had a higher trading volume dominance against Bitcoin. However, the rally didn’t last for long as immediately after 2021 ended, the year 2022 had severe downfall including FTX collapse.
Hence, though the crypto market is observing a bullish trend, if history repeats this bull action won’t last for long.