Bitcoin (BTC) continues to rule the crypto market as its market dominance has now reached 54%. This represents its highest level in the last two and a half years, even as the flagship cryptocurrency continues to show strong signs ahead of its halving next year.
BTC Dominance History
Bitcoin market dominance measures the degree of the market capitalization of Bitcoin relative to that of the overall crypto market. It is usually an indicator of the asset’s strength, and a dominance of over 50% usually signals that it is bullish.
Interestingly, Bitcoin started crawling its way up the market dominance at the beginning of October. At the time, its dominance was 49%. However, it soon broke the jinx and crossed to reach the then-new two-and-a-half-year high.
Generally, October has been a very strong month for crypto, earning it the epithet ‘Uptober.’ To put the above statement into perspective, BTC has seen a nearly 30% gain in October alone. This has helped it to rise from $27,000 at the beginning of the month to $35,000 where it currently hovers, per CoinMarketCap data.
In 2017, Bitcoin dominance was hovering around 80% while Ether (ETH) followed with around 10%-17%. However, since the introduction of new cryptocurrencies, and their growth thereafter, Bitcoin has seen its dominance float between 50% and 60%. Nonetheless, anything above 50% is an indicator of swell times for Bitcoin.
Bitcoin’s halving, which is slated for April 2024, is an event that happens every four years. During the event, the mining reward per block is halved, thus effectively cutting the supply of the asset and driving its demand upwards. As has happened severally in the past, halving ultimately brings about a bullish trend as the asset price heads to the moon.
Meanwhile, recall that the total supply of Bitcoin is fixed at 21 million. This means that the halving creates a supply-demand gap that ensures to counteract inflation and maintain scarcity.
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