In a week marked by significant volatility in the cryptocurrency market, Bitcoin (BTC) has emerged with notable gains, both in price and market dominance. The world's premier cryptocurrency reclaimed the $35,000 price level and achieved a market dominance not seen in over 30 months.
Bitcoin's market dominance, a metric that measures its market capitalization relative to the total market capitalization of all digital currencies, reached an impressive 54% this week. This surge followed three consecutive weeks where it saw a 0.5% increase, settling at 52.4% the previous week. To put this in perspective, this is the highest dominance rate Bitcoin has achieved in the past two and a half years. During the bull market of April 2021, Bitcoin's dominance fluctuated between 50% and 60%. This means that currently, Bitcoin's value is 50% greater than the combined value of all other cryptocurrencies.
For much of the past two years, Bitcoin's dominance index oscillated between 39% and 49%. A significant breakout occurred in mid-June when Bitcoin's price touched the $30,000 mark. This surge coincided with news that BlackRock, the world's largest asset manager, had filed for a spot Bitcoin exchange-traded fund (ETF) in the United States.
CoinGecko, a leading cryptocurrency data aggregator, highlighted the importance of the Bitcoin dominance metric in a recent blog post. They stated, "Bitcoin dominance is a great crypto trading tool that sheds more light on changing market trends. You can apply it to manage a diversified crypto portfolio or adjust your investment strategies based on trends." They further emphasized that while the dominance metric provides valuable insights, it doesn't necessarily dictate a definitive trend for Bitcoin or altcoins. Instead, it serves as a tool to inform investment decisions.
Despite the rise in market dominance, Bitcoin's trading journey wasn't without turbulence. In the past 24 hours, approximately $1 billion in open interest was wiped out. Short liquidations soared to over $216 million, marking the highest figure for 2023, as per data from CoinGlass.
The week also brought a slew of positive news for Bitcoin, especially concerning the much-anticipated spot BTC ETF applications from Wall Street behemoths. Notably, the ticker for BlackRock's BTC ETF application appeared on the official website of the Depository Trust & Clearing Corporation (DTCC). This led to speculation that BlackRock might have begun seeding the product. However, BlackRock clarified that its application remains under review by the U.S. Securities and Exchange Commission (SEC).
As of 5:17 a.m. ET on Friday, Bitcoin traded in the red zone at $34,154.54. The 24-hour trading volume decreased by 23.05% to $18 billion, representing a 0.95% drop in the last 24 hours but a 14.6% increase over the past week. Bitcoin's total circulating supply is currently 19.53 billion BTC, with its market cap valued at approximately $666.93 billion, as per data from CoinMarketCap.
