While the price of Bitcoin continues to show several ups and downs - the markets continue to show faith in the currency. This is a pattern which has been seen multiple times in the past. However, today is a significant day as Bitcoin’s market dominance finally surged past 50% in almost nine months. The last time that Bitcoin was at such a dominating position in the markets was on the 19th of December, 2017.
However, while Bitcoin’s market dominance has risen, the market scenarios then and now are quite different. Back then, Bitcoin covered a 50% market share of the cryptocurrency markets, where the total crypto market cap stood at $598 Billion. However, while Bitcoin’s market dominance is 50% as of this writing, the overall market cap is less than half of what it was back then. The total cryptocurrency market cap as of this writing is that of $216 Billion only.
For those who may not be aware, Bitcoin Dominance is basically the measure of the money that flows into Bitcoins as opposed to the money that flows into the rest of the cryptocurrency markets. A 50% Bitcoin dominance means that out of all the investments made across the cryptocurrency markets, 50% of the money has flown into Bitcoin investments. The total market cap is that of $216 Billion, which contains Bitcoins worth $108 Billion while all the other cryptocurrencies combined account for the other $108 Billion.
There are usually two conditions where the Bitcoin dominance rises:
When Bitcoin is performing exceptionally well (such as back in mid-December, when the price of the currency had crossed unprecedented highs - crossing more than $19,500).
When the markets are performing exceptionally bad (the recent scenario where cryptocurrency prices keep falling. Bitcoin is usually considered to be a much safer investment than altcoins in such times because it can rise faster as opposed to altcoins).
Bitcoin’s market dominance had sunk to an all-time low in mid-January where it almost hit the 30% mark. This was due to the fact that investors were showing great faith in altcoins which were booming at that time as Ripple and Ethereum, as well as various other currencies were hitting and crossing their all-time high records.
However, now that markets are falling - the faith of investors is once again back on Bitcoin, which is the safest investment option considering the present scenario of the markets. While the price of Bitcoin continues to be highly volatile, if this kind of a reaction continues and the gains keep increasing, the currency may see a recovery in due time.
As of this writing, Bitcoin continues to dominate the markets with Ethereum, Ripple and Bitcoin Cash following. The market dominance of Ethereum as of now is 15.25%, Ripple stands at 5.58% and Bitcoin Cash stands at 4.60%. It will be interesting to see how the next few months fold out for the cryptocurrency markets as Q3 and Q4 are usually considered to be bullish months.