Bitcoin's market dominance approaches multi-year high

Quick Take

  • Bitcoin is outperforming ether and other altcoins, as its market dominance approaches a multi-year high.
  • The world’s largest digital asset by market cap is up 66% this year, compared with a 32% gain for ether.

Bitcoin BTC -1.18% 's market dominance is approaching a multi-year high, rising to 51.2% on Tuesday and closing in on the two year high of 52% reached at the end of June, according to TradingView data.

The world's largest digital asset by market cap has outperformed ether and other major altcoins since the beginning of the year. Bitcoin changed hands for $27,354 at 2:28 p.m. ET, according to CoinGecko. The world's largest digital asset by market cap has traded flat over the past seven days, but is still up 66% this year compared with 32% for ether. The world's second-largest digital asset by market cap is priced at $1,561, down almost 6% in the past week.

Tepid response to ether futures ETFs 

"There are many reasons for the current altcoin/ether underperformance vis-à-vis bitcoin," Deutsche Digital Assets Head of Research André Dragosch told The Block. He said that a major catalyst for the underperformance of ether was the lukewarm reception from institutional investors toward last week's newly deployed Ethereum Futures ETFs in the U.S.

"In aggregate, Ethereum ETH +3.92% ETPs only attracted a meager plus $0.9 million in net inflows last week despite the debut of these new ETFs. In comparison, net inflows into Bitcoin ETPs amounted to plus $85.4 million last week," Dragosch added.


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The analyst also attributed the underperformance of ether compared to bitcoin to a recent research paper suggesting that the Bitcoin blockchain could potentially handle the smart contract computations associated with the Ethereum network.

"The underperformance appears to be related to the fact that bitcoin developer Robin Linus published a research paper that suggests that 'any computable function can be verified on bitcoin'."

Dragosch added that this implies that essentially all altcoin utilities could be enabled on the bitcoin blockchain. This is a view that bitcoin pioneer Max Keiser concurred with.

"Ether offers nothing that can’t be done with bitcoin," Keiser told The Block.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

Brian McGleenon is a UK-based markets reporter for The Block. He has worked as a financial journalist and producer for multiple news outlets over the years, such as Fuji Television, The Independent, Yahoo Finance, The Evening Standard, and The Daily Express. Brian is also a screenwriter and producer with one feature film produced and one in development with Northern Ireland Screen. Apart from web3 and cryptocurrency developments, he is also interested in geopolitics, environmental issues, artificial intelligence, and longevity research. Get in touch via email [email protected].


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