Bitcoin, the largest digital asset by market cap, has lost significant dominance over the last year. More recently, it failed to retain its value over $12,000. Following the latest downside correction, the King coin dropped back to $11,740.
At the of writing, BTC dominance was a little over 58%. The coin recently breached the dominance support level and was now in the final leg of the structure. This was stated by the crypto analytic firm Santiment’s latest data which further revealed that the next support for a weekly dominance stood at around 56%.
Besides, another support point stood at 54%. Despite the probability of a further drop, Bitcoin could potentially bounce back. Along the same line, Santiment noted
“Bitcoin will reclaim dominance, we just don’t know when. You still can enjoy 2-3x in many alts. It’s much easier to pump alts. But Bitcoin. We see more and more confirmation we could get to 15K.”
But it could be a while before Bitcoin gets some ground and climbs to $15k, something that hasn’t been witnessed in more than two years. The Altcoin pump is here to stay at least until the Bitcoin reaches the level mentioned above.
Meanwhile, the market dominance of the altcoins rose to a stunning $159 billion market cap, a level unseen in more than two years. Bitcoin entered the 5-digit values in the last week of July and brought in spectacular returns for investors. Despite a really good run by the premier cryptocurrency, the altcoins’ market cap jumped significantly high.
This was also noted in the July edition of Binance’s Trading Report which stated that in addition to the spot markets, traders in derivatives space were also bullish on altcoin contracts.
Altcoins continued to dominate the headlines. Especially in the first two weeks of July, altcoins gained traction as volume increased from 32% to 60%. According to Binance’s report, during this period, altcoin contracts such as LINK, ADA, and VET experienced high volatility and volume.
Additionally, in the derivatives market, it was the altcoins’ contracts that significantly drove most of the open interest growth. This essentially implied that the traders were “positioning long-term directional bets on altcoins”.
Meanwhile, Ethereum and the DeFi craze are two crucial factors that appeared promising to the alt market. August saw the total valued locked in DeFi soar to $6.38 billion.
The growing interest of institutional investors in DeFi is yet another plus point. Industry giants such as TD Ameritrade, CMT Digital as well as Arca Labs, have all invested in DeFi space. The expectations surrounding the much-anticipated launch of Ethereum 2.0 was also another driver of the collective altcoin pump.
