Crypto Bloodbath Leaves Bitcoin With 51% Share of the Market
Bitcoin’s share of the total cryptocurrency market rose to more than half on Saturday, marking the first such occurrence since Dec. 19. Bitcoin’s so-called dominance rate has increased by a third this year, highlighting the precipitous drop in market value for altcoins and tokens.
Bitcoin Dominance Grows
At its highest point Saturday, bitcoin’s dominance rate hit 51.1%, according to CoinMarketCap. This essentially means that more than half of the entire market capitalization for cryptocurrency is held in bitcoin. At the time of writing, BTC’s market share was 50.9%.
The divergence between bitcoin and other cryptocurrencies is being driven by a rapid decline in market share for altcoins and tokens. Over the past seven days, the total value of crypto assets excluding bitcoin has plunged 20%. Bitcoin has lost roughly 9% over the same period.
Among the top-20 altcoins and tokens (excluding Tether), 18 have reported double-digit percentage losses in the past week. The IOTA price has been the hardest hit, falling nearly 37% since last Saturday.
Over the past few hours, Ethereum has seen its value plummet by as much as 15% with traders parking their funds into Tether’s USDT.
At press time, crypto’s total market cap is $216.9 billion after hitting a low of $207.1 billion earlier.
As Hacked reported earlier this week, cryptocurrencies have been in a state of disarray since the SEC decided to delay a ruling on a closely watched bitcoin exchange-traded fund. It is not entirely clear why investors put so much stock in the ETF announcement given that: (1) the agency has not denied the application; (2) crypto assets have enjoyed greater regulatory clarity in recent months; (3) two of the world’s largest stock exchange operators (ICE and Boerse Stuttgart) have announced plans to bring bitcoin trading to institutional investors.
In other words, fundamentally, the state of the cryptocurrency market is far better today than it was at the start of 2018.
Prior to the SEC’s announcement, bitcoin was primed for a corrective rally after prices found support near the 50-period moving average. The SEC-induced drop exposes the bitcoin price to 2018 lows. BTC traded as low as $5,995 on Bitstamp Friday, marking a new six-week low.
The SEC has marked Sept. 30 as a deadline for delivering a verdict on the VanEck SolidX Bitcoin ETF. However, many in the investment community believe that a final judgment will be delayed once more as regulators evaluate whether the application’s value proposition addresses concerns around price manipulation and liquidity.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.