Bitcoin’s domination is eroding when ETH and altcoins gain popularity.

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After the beginning of 2021, the Bitcoin supremacy index has dropped by 20 percentage points. Over the same time frame, ETH, BNB, and more speculative altcoin bets have grown in dominance.

Bitcoin’s (BTC) supremacy momentarily dropped below 50% last week for the first time since January 2018, signalling that more speculative bets on altcoins were on the increase.

The Bitcoin supremacy index, which tests the market capitalisation of BTC,

tion relative to the broader cryptocurrency market, reached a low of 49.35% on Thursday, according to CoinMarketCap. At the beginning of 2021, BTC dominance was 70.68%.

Ethereum (ETH), meanwhile, accounted for nearly 15% of the overall market at its peak on Thursday. ETH dominance is up nearly 4 percentage points since the start of 2021.

Over the last seven days, ETH has outperformed BTC by a whopping 9.5 percent. The second-largest cryptocurrency by market capitalisation is down 10% from its previous all-time peak, while Bitcoin has corrected more than 20%.

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Binance Coin (BNB) has also slowly increased its market share this year, rising from 0.71 percent on January 1 to 4.17 percent on April 25. BNB is being funded by a number of fundamental influences, including increasing Binance app adoption and a coordinated burn of $600 million in tokens in the first quarter.

Meanwhile, cryptocurrencies outside the top ten have seen their market share rise from less than 11 percent to more than 18 percent since January 1.


Despite registering multiple record highs this year, Bitcoin’s dominance relative to altcoins has declined sharply. Source: CoinMarketCap

Commenting on the market shuffle, Meltem Demirors, the chief strategy officer of crypto investment manager CoinShares, said she is “seeing a lot of folks chasing returns by moving further out on the risk spectrum.”

According to Demirors, 94 cryptocurrencies currently have a market capitalisation of $1 billion or more. According to CoinMarketCap, the number had dropped to 87 at the time of publication. Another seven ventures were worth $900 million or more.

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Analysts disagree on the timing and speed of the so-called alt season, a phase of the trading cycle during which multiple altcoins rally against the dollar and Bitcoin. According to Ben Lilly, co-founder and researcher at Jarvis Labs, now is not the right time to reallocate from BTC to altcoins from a risk-adjusted standpoint.

Meanwhile, a study conducted by Filbfilb, co-founder of the Decentrader trading suite, concluded that altcoins are entering a significant boom era.

The current market cap for altcoins is $937 billion.


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