Ethereum has gained a substantial market share over bitcoin in the last five year. Ethereum’s growth has continued for the entire time. Altcoins are now competing for the remaining market share. While bitcoin was the dominant cryptocurrency for the longest time it is not likely that they will ever catch up to the dominance of bitcoin. Bitcoin’s market dominance fell to 50% this year.
As ethereum’s market dominance has grown, it is important to look at what this might mean for the digital asset and how it may play out in the future. Although Ethereum is having an amazing year, can growing market dominance signal a continued rally?
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Ethereum dominance on the rise
Ethereum’s market cap had grown as a result of the price surge that the digital asset recorded this year. At almost $500 billion, it remains at only about half of bitcoin’s market cap but has grown to become one of the most valuable assets in the world. As adoption has grown quickly, altcoin’s market dominance also increased.
The market share of this asset has increased by 10% in the past year. This is a significant increase from the bitcoin-dominated position. It was a measure of the growth in cryptocurrency, and also has long-term implications.
Source: ETHUSD on TradingView.com| Source: ETHUSD on TradingView.com
As the market continues to dominate ethereum, its value will only increase. There are many applications for ethereum, including NFTs and DeFi. It’s expected to continue its dominance of the market.
It is easy to see what this means for altcoin. This type of adoption will lead to greater demand. Additionally, as the ETH burner continues to decrease the supply of coins on the market the price of altcoin could reach new highs over the next few months.
Altcoins take control of the market
TradingPlatforms has just released a report that shows altcoins have more than tripled market dominance over the past seven years. Bitcoin held over 90% market dominance at one time. As altcoins like Ethereum have gained prominence and been adopted more, the number of bitcoin users has declined significantly.
According to the report, altcoin’s dominance is due to an attitude shift in regards cryptocurrency. Many investors believe that bitcoin has already grown too much and is too expensive and as such, are looking at what they believe to be ‘the next bitcoin.’ This has led to the adoption of altcoins as an alternative to bitcoin.
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Additionally, higher market dominance means higher market caps. These market caps play a key role in determining how cryptocurrencies are ranked. Investors will usually look at market caps to determine if a cryptocurrency is ‘safe’ to invest in and “in essence, it’s a pointer to how stable the asset is,” the report reads.
As more investors see ethereum’s market dominance, this could indicate that it is headed for greater adoption. Bullish tendencies are evident as we move into the new year.
Featured image by ElevenNews. Chart from TradingView.com