Bitcoin Dominance Drops to Lowest Level in Years, What Happened in the Market?

If the price drops significantly, traders will sell Bitcoin from exchanges. This is human nature, and while Bitcoin seems to be in the "off-season" right now, the "grass" is always greener on the other side.

What we mean by “greener” is that there seems to be more money pouring into crypto assets other than Bitcoin. This can only mean one thing: it’s high season for crypto assets other than Bitcoin.

Arcane research shows that Bitcoin accounts for 51.8% of the total market value of crypto assets, the lowest level in two years.

In April, mid-cap crypto assets accounted for the largest share of the market by market cap, and every asset outperformed Bitcoin, even the large-cap assets. If the indicators point in the right direction, the season has just begun.

Something really has changed in these seven months, and the last boom in crypto assets other than Bitcoin seems very far away.

Bitcoinist pointed out: “For many years, confidence in other crypto assets has been poor, so there has been no inflow of funds. But with the popularity of DeFi and Bitcoin breaking through the trillion-dollar market value, it has driven the boom in other crypto fields, creating ideal conditions for capital to eventually return to the crypto market.

In just a few months, billions of dollars have been added to the crypto market, a new generation of crypto assets has been born, and the comfortable days of the U.S. dollar are coming to an end.”

From the vantage point we have now, we know how DeFi is slowly but surely conquering the world, and we see the innovations that the crypto market continues to generate. We can feel the energy that these new projects are bringing to the crypto asset ecosystem.

As Bitcoinist points out, “Interestingly, unlike the crypto market boom of 2017, when most cryptocurrencies gained traction simply because of the hype surrounding them, this time around, the growth of most crypto assets is driven by innovation and real-life use cases.”

The theory holds that with each crypto-currency boom, Bitcoin’s total loss rate will decline and then recover half of the losses, though this is not an exact theory.

In the spring of 2017, Bitcoin’s dominance fell to 38%, then slowly recovered until the crypto boom of winter 2017 to 2018, when Bitcoin’s dominance fell to a rare 32%.

All of this means that if the indicators are pointing in the right direction, the bull run for some other crypto assets has just begun. If Bitcoin’s market cap dominance drops from 51% to 30%, that means a lot of money is entering the crypto market, and this time it means “a lot.”