In a recent tweet, Kaiko, a leading cryptocurrency data provider, revealed a remarkable surge in Bitcoin (BTC) volume dominance on U.S. exchanges. Since the start of 2023, BTC’s dominance has skyrocketed from 29% to an impressive 44%. This surge signifies a significant shift in market sentiment as traders flock to BTC amidst the lingering bear market.
Bitcoin’s Market Cap Hits Two-Year High Relative To Altcoins
Additionally, during bearish market conditions, altcoins typically fall out of favor as traders seek refuge in Bitcoin, widely regarded as the ultimate crypto safe haven.
The data from Kaiko’s latest report showcases this trend, as the volume of BTC traded relative to all other cryptocurrencies has increased from 25% to 32% since the beginning of the year. On the other hand, Altcoins have suffered particularly steep losses during this period.
Moreover, Bitcoin’s market capitalization relative to altcoins has reached a two-year high, further highlighting the growing preference for the pioneering cryptocurrency. Investors and traders seek Bitcoin’s stability and resilience during uncertain times.
Kaiko’s report sheds light on Ethereum (ETH) options trading in a separate development. ETH call option volume has recently hit a yearly low, accounting for only 55% of the total weekly option volume. This figure represents a significant decline from early June, when ETH calls accounted for 70% of the total volume.
Over the past few months, there has been a rise in ETH call volume driven by a systemic player overwriting a significant number of calls.
However, the recent market conditions have led to increased demand for puts, indicating bearish bets on ETH’s performance. Last week, ETH spot prices briefly dipped below the crucial support level of $1.7k before experiencing a recovery over the weekend.
However, the demand for BTC and ETH options has surged following the U.S. Securities and Exchange Commission’s (SEC) actions against major exchanges, including Binance and Coinbase.
The regulatory scrutiny has intensified market volatility, prompting traders to explore various options to hedge their positions and manage risks effectively.
Nevertheless, as the cryptocurrency market evolves, these shifting trends and dynamics provide valuable insights into investor behavior and market sentiment.
The dominance of Bitcoin on U.S. exchanges and the changing landscape of ETH options trading underscore the growing importance of monitoring and understanding these market indicators.
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