Bitcoin's dominance is eroding as altcoins gain popularity.
Bitcoin's dominance in the crypto market is declining and may continue to decline, but analysts remain confident that its price will reach a new all-time high by the end of the year.
On Thursday morning, Bitcoin's dominance metric—its market capitalization as a percentage of the total crypto market capitalization—was 57.79%. The previous day, the Federal Open Market Committee met investor expectations by cutting its benchmark interest rate by 25 basis points, after which the price of BTC rose 1% overnight.
Bitcoin remained stable after the rate cut news, but by Thursday morning its price had reached $118,000, its highest level in over a month.
John Glover, chief investment officer at Bitcoin lending platform Ledn, noted that the market's initially muted reaction to the rate cut does not mean BTC won't end the year on a positive note.
“I expect Bitcoin to be between $140,000 and $145,000 by the end of the year,” he told Decrypt. “Rate cuts will support this trend as investors move funds into BTC as a safe haven amid the expected dollar devaluation.”
Other experts also confirm the long-term bullish outlook for Bitcoin. However, in the short term, attention has shifted to altcoins, which have shown more significant growth ahead of the expected SEC approval of a number of spot cryptocurrency ETFs.
“Short-term data may indicate a decline in Bitcoin's dominance as traders shift to altcoins in anticipation of new ETF approvals,” explained BOB co-founder Dom Hartz. “This rotation may be temporary, but it's important to remember that Bitcoin remains the most secure network, the most trusted digital asset, and the most trusted by institutional investors.”
At press time, XRP is up 3% in 24 hours, trading at $3.12; BNB on Binance is up about 5%, reaching $996, and hitting a new all-time high of over $1,000.
Solana, recently boosted by corporate treasuries buying billions of dollars' worth of SOL, rose nearly 6% in 24 hours to $248. Over the past month, Solana has become one of the top performers among major crypto assets, gaining 35%.
Users of the Myriad forecasting platform, owned by Decrypt's parent company, Dastan, are skeptical about Bitcoin's continued dominance amid growing interest in altcoins. At the time of writing, 53% of respondents believe BTC's share will decline to 53% before returning to 63%.
The last time Bitcoin achieved this level of dominance was in mid-July, when it reached a new all-time high of over $112,000. A month later, it surpassed that record, reaching $124,000, but still lost market share to altcoins.
However, as Hartz emphasized, this is not a significant issue for institutional investors: “This week alone, the ETF has seen six consecutive days of inflows, attracting more than $2 billion, with 7% of the total assets now held in corporate and government treasuries.”
Source: cryptonews.net
