Key Points
- Bitcoin’s dominance in the cryptocurrency market is decreasing, with altcoin market cap showing an increase.
- The launch of spot Ethereum ETFs could potentially lead to a further decrease in Bitcoin dominance.
Bitcoin’s dominance in the cryptocurrency market is showing a downward trend. On July 10, Bitcoin’s dominance was at 55.10%, but at the time of writing, it has fallen to 54.62%.
The dominance of Bitcoin is a crucial indicator of its price as it reflects how the market cap of Bitcoin compares to the market cap of other cryptocurrencies.
Bitcoin’s Dominance: A Continuing Trend?
If Bitcoin’s dominance increases, it implies that Bitcoin is outperforming the average altcoin. However, a decrease suggests that Bitcoin is losing momentum and altcoins are performing better.
The cryptocurrencies have performed better on a Year-To-Date (YTD) basis. However, in the last month and recent times, the opposite has been true. If this trend continues, Bitcoin could potentially see a further fall.
At the time of writing, Bitcoin was trading at $58,257, representing a 1.37% increase in the last seven days. An indicator to check if Bitcoin is starting to lose its superiority is the TOTAL2, also known as the total market cap of the crypto market excluding Bitcoin.
Altcoins Ready to Challenge Bitcoin
If the TOTAL2 increases, it indicates that altcoins are performing better than Bitcoin. However, a decrease suggests that Bitcoin is leading the market resurgence.
Between July 5 and the time of writing, the TOTAL2 has risen by 8.01%, indicating that the prices of the average altcoins have been better than Bitcoin’s dominance.
If this upward trend continues, the market cap could potentially hit $1 trillion, possibly driving a closer move to the much-anticipated altcoin season. This could result in Bitcoin’s correction continuing.
One factor that could drive an increase in the dominance of altcoins is Ethereum (ETH). Historically, when Ethereum’s price performs better than Bitcoin’s, it gives strength to other altcoins, thereby reducing Bitcoin’s dominance.
Market participants are eagerly anticipating the launch of the spot Ethereum ETFs. However, it is also crucial to look at the ETH/BTC chart to see if Ethereum could take over Bitcoin’s dominance in the coming weeks.
When the ETH/BTC ratio increases, it suggests that Ethereum is outperforming Bitcoin. On the other hand, a decrease suggests the opposite. At the time of writing, the ETH/BTC ratio has increased to 0.053, meaning 1 ETH equals 0.053 BTC.
The Relative Strength Index (RSI) indicates that Ethereum is gathering a good level of momentum. If this continues, it could potentially drive the ratio to 0.056, possibly leading to a further decrease in Bitcoin’s dominance.
