Rising Dominance Signals Strength for Bitcoin
Bitcoin's market dominance has surged to 54%, its highest level in the past 30 months, indicating that the leading cryptocurrency is gaining strength as it approaches the upcoming halving event scheduled for April 2024. Market dominance is a measure of Bitcoin's market capitalization relative to the overall digital asset market, highlighting its dominance in the industry.
The Bitcoin Halving and its Impact
The Bitcoin halving is an event that occurs every four years, in which the mining reward per block is halved. This reduction in supply, combined with growing demand, leads to a bullish price momentum for Bitcoin. The next halving in 2024 will decrease the mining reward from the current 6.25 BTC to 3.125 BTC, creating a supply-demand gap that limits the influx of new Bitcoin into the market. With a fixed total supply of 21 million Bitcoin, the halving event is a crucial factor in Bitcoin's long-term value.
Bitcoin's Market Dominance on the Rise
Bitcoin's market dominance has been steadily increasing since the beginning of October. It has risen from below 49% to reach its current 54% level, marking its highest point since the last bull run in April. October has traditionally been a bullish month for cryptocurrencies, and this year has been no exception. Bitcoin has experienced double-digit percentage gains over the past few weeks, propelling its price from just below $27,000 to a new yearly high of $35,000.
A Decline in Market Dominance
In 2017, Bitcoin maintained a market dominance of over 80%, with Ether (ETH) following closely behind with a market dominance of 10%–17%. However, over the years, Bitcoin's market dominance has declined due to the emergence of numerous cryptocurrencies and the growth of new tokens during the recent bull run in 2021.
Overall, Bitcoin's increasing market dominance and its upcoming halving event indicate that the cryptocurrency is poised for further growth and bullish price momentum in the future.
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