Bitcoin Market Dominance Reaches 2-Month High as Altcoins Struggle February 1, 2022 February 1, 2022 Kelly Cromley http://1AZFjzw2#Nwf63pYaMWq#xIY
Bitcoin NewsFebruary 1, 2022 by Kelly Cromley

Bitcoin Market Dominance Reaches 2-Month High as Altcoins Struggle

Bitcoin (BTC) is reclaiming market share from altcoins after a week in which its market capitalization dominance reached its highest level since November 2021. According to CoinMarketCap and TradingView data, BTC temporarily accounted for more than 42% of the total cryptocurrency market value in late January.

After suffering significant losses on the way down from November’s all-time highs, the current developments have enabled Bitcoin to regain some of its lost territory versus altcoins. Previously, emphasis was concentrated on prominent tokens like as Ether (ETH), Solana (SOL), and others, which took advantage of Bitcoin’s vulnerability.

With the tables apparently turned, BTC is regaining momentum, having maintained a 40% market share for the latter part of last month. Market capitalization is far from an accurate indicator of market strength, since it puts proven tokens against those with a limited history and ignores the effort or value underlying a specific cryptocurrency’s market capitalization.

Analysts prefer the realized cap, which prices each unexpended transaction output (UTXO) depending on the recent price movement of the cryptocurrencies involved in the transaction. Unlike the normal market value, the realized cap has stayed relatively stable since November’s all-time highs, presently standing at $453 billion, according to statistics from on-chain analytics company Messari.

On the subject of attained capitalization, the Ether measure has seen a greater dramatic retracement since Q4 of last year. With debate surrounding the Ethereum 2.0 project and record-high transaction costs, doubts about Ethereum’s capacity to contend with Bitcoin begin to swirl.

“Ethereum is not a value storage and settlement platform in the same way that Bitcoin is,” analyst Dylan LeClair wrote Tuesday in response to the fees debate. “Since its introduction, ETH has been less economical as a settlement network as its currency has gained value.”

According to data from on-chain analytics startup Glassnode, the value exchanged on the Ethereum blockchain per $1 in fees is dropping in comparison to Bitcoin. According to other estimates, Bitcoin transaction costs currently account for less than 1% of the fees paid for ETH trades.

“I almost couldn’t trust it when I witnessed it, BTC is now equal to 1% of $ETH in regards to the amount people are paying to utilize the network,” VC partner Chris Burniske wrote on Twitter after posting the data.

AuthorKelly Cromley

Kelly is our in house crytpto researcher, delving into the stories which matter from blockchains being used in the real world to new ico coming out.