Bitcoin dominance reaches 64.89%, with price hitting $97,000, the highest since 2021. This rise contrasts with substantial declines in many altcoins. Factors include Bitcoin’s established market presence, limited supply, and growing institutional interest amidst investor shifts from U.S. treasuries. However, potential geopolitical resolutions could alter Bitcoin’s current stronghold.
Bitcoin’s share of the cryptocurrency market has surged to 64.89% today, the highest it’s been since early 2021, while its price climbed above $97,000 on Friday morning. This increase in BTC’s dominance, which reflects its market capitalisation as a proportion of the whole crypto market, has jumped from approximately 57.90% at the year’s start, according to TradingView. Earlier this month, it had dipped to around 55% amid a surge in altcoin prices triggered by Donald Trump’s election victory.
However, that early euphoria shifted to caution as the Trump administration began ramping up tariffs in February and March, deterring investment in altcoins. While Bitcoin itself faced some fallout due to these tariffs, recent exemptions have provided a boost. Though it hasn’t fully restored the ascendance of many major alternative cryptocurrencies, Bitcoin’s recovery is noteworthy.
As of the latest data, Bitcoin is now just 10.9% shy of its all-time high of $108,786, a peak reached in January. Meanwhile, cryptocurrencies like Ethereum, Solana, and Dogecoin experienced declines of 54%, 43%, and 61% from their highs noted in December and January, respectively. Although Bitcoin retraced slightly to $96,947, it remains up by 0.7% for the day.
Market analyst David Morrison from Trade Nation attributes Bitcoin’s superior performance to several factors, primarily its first-mover advantage. In his conversation with Decrypt, he indicated that Bitcoin enjoys higher acceptance than many altcoins, bolstered by a more favourable regulatory climate, which may continue to improve under the current administration.
He further notes that irrespective of bearish market trends, Bitcoin attracts both retail and institutional investors, primarily because its supply is inherently restricted, unlike many alternative cryptocurrencies. Given its proven resilience during market fluctuations, investors are likely to view Bitcoin as a safe bet for potential rebounds following downturns.
This situation appears particularly advantageous while tariffs put pressure on the U.S. and global economies, enabling Bitcoin to strengthen its dominance in the market. Additionally, there’s been a noticeable shift of investors moving away from U.S. treasuries and comparable assets; flows into Bitcoin ETFs exceeded gold ETF flows by $4 billion this week.
Morrison suggests that institutional interest in Bitcoin may further enhance its market share, especially if it were to cross the 70% threshold. However, he cautions that if the U.S. were to successfully negotiate a resolution with China, the dynamic could shift. Recent signs indicate a willingness from the Trump administration to engage in trade talks, with China currently considering an offer.
Should the wider economic landscape improve, it could foster a more bullish environment for the cryptocurrency market overall, potentially diminishing Bitcoin’s dominance in the longer run. Morrison notes that as risk appetite grows, investors often look beyond Bitcoin for diversification, and some altcoins may outperform BTC significantly in terms of percentage gains.
