Bitcoin's Dominance Rises to 50%: Is There Room for Further Growth?

As Bitcoin retains its stability with a price around $26,700, its market dominance is notably increasing, reaching 50.2% as of the 18th of this month.

Why is Bitcoin's share in the digital asset market climbing, and what could this mean for the future of cryptocurrency?

Explore what industry experts have to say about long-term trends, market risks, and recent regulatory changes.

Bitcoin's Market Share Climbs to Recent Highs

As of the 18th, Bitcoin's market dominance, which represents its share in the overall digital asset market, has reached 50.2%.

This is the highest level it has attained in the last month and is approaching the 52% level recorded at the end of June—a 26-month high.

From a longer-term perspective, Bitcoin's dominance had been fluctuating between 39% and 49% for over two years until it surged to 52% in June.

This uptick was attributed to heightened expectations of substantial capital inflows into Bitcoin following an application for a Bitcoin ETF (Exchange-Traded Fund) by BlackRock, the world's largest asset management firm.

Analysts Weigh In on Altcoin Dangers

Markus Thielen, Head of Research at crypto service provider Matrixport, pointed out that while Bitcoin enjoys "latent buying pressure" due to its ETF listing, altcoins may be on the brink of breaking their lows.

Thielen listed several risks in the altcoin market: the token sell-off from the defunct crypto exchange FXT, diminishing returns in the Ethereum protocol, and upcoming token unlocks that would allow venture capitalists to sell off their holdings.

He stated, "So far this year, Bitcoin reached its peak in July, while Ethereum peaked in April. Announcements of these ETFs haven't benefitted altcoins in any way. This includes even Ethereum (ETH)."

How NYFDS Proposals Could Benefit Bitcoin

Macro analyst Noelle Acheson indicated that Bitcoin is likely to benefit from the latest regulatory changes proposed by the New York Financial Services Department (NYFDS) on the 18th.

The changes include stricter regulations for listing crypto assets on exchanges, as well as adding Bitcoin to a "green list" that allows license holders to list or custody the asset without additional regulatory hurdles.

Acheson mentioned in her newsletter, "The immediate impact on the crypto market could be a further influx of funds into Bitcoin as it solidifies its position as a 'safe' digital asset."