Bitcoin dominance shifts from day-to-day as the market ebbs and flows, but bitcoin has consistently taken up a large portion of the cryptocurrency market over the past few years.
Bitcoin dominance refers to the percentage of the total market capitalization that bitcoin represents. At the time of writing, bitcoin dominance is around 40%. This means that bitcoin makes up 40% of the total value of all cryptocurrencies.
At its highest point, bitcoin dominance was at around 82%. This means that bitcoin’s market capitalization was greater than that of all other cryptocurrencies combined.
What does bitcoin dominance mean for investors and traders?
For one, it indicates that bitcoin is still the king of cryptocurrencies. It is the most widely-known and most widely-traded crypto, so it naturally has the largest market cap. Bitcoin’s dominance also means
Bitcoin dominance is important because it gives us an idea of how much influence bitcoin has over the cryptocurrency market. A high bitcoin dominance means that bitcoin is more influential than other cryptocurrencies. This can be good or bad depending on your perspective.
For bitcoin investors, a high bitcoin dominance is good because it means that bitcoin is more likely to go up in value when the cryptocurrency market as a whole goes up. On the other hand, a low bitcoin dominance means that bitcoin is less influential and therefore more volatile.
When altcoins are doing well, bitcoin dominance usually goes down. This is because investors are selling bitcoin to buy altcoins. Altcoin dominance is the percentage of the total market capitalization that altcoins represent. At the time of writing, altcoin dominance is around 60%.
Keep in mind there are now close to 20,000 altcoins on the market, so even a small percentage of the total market cap can represent a large amount of money.
The reason why bitcoin and altcoin dominance are important is because they give us an idea of which direction the market is going. If bitcoin dominance is going up, it means that bitcoin is gaining market share. This usually happens when the price of bitcoin goes up or when altcoins go down in value.
On the other hand, if bitcoin dominance is going down, it means that altcoins are doing well relative to bitcoin. This usually happens when the price of bitcoin goes down.
Tips for trading during bitcoin dominance
There are a number of things to pay attention to when trading during bitcoin dominance.
1. First, you need to understand what bitcoin dominance is and how it affects the market.
2. Second, you need to pay attention to the trend. If bitcoin dominance is going up, it means that bitcoin is gaining market share. This is usually a good time to buy bitcoin.
3. Third, you need to be aware of the risks involved in trading during bitcoin dominance. The most obvious risk is that bitcoin could lose market share to altcoins. This would cause the price of bitcoin to go down.
4. Finally, you need to have a plan for both buying and selling bitcoin. We can’t predict the future, but having a plan will help you make the most of any market situation.
There are no guarantees when it comes to trading, but if you understand bitcoin dominance and the trends, you’ll be in a better position to make successful trades.