The pioneering cryptocurrency has risen to fame again after DeFi summer stole much of the limelight.
Bitcoin’s dominance rises to 68%
According to data from the tracking site CoinMarketCap, Bitcoin’s market share dominance is now 66% after a long “DeFi summer” and a mini-old season in October. These levels were last seen in 2019, and the years before 2017 before that.
Bitcoin Superstar now accounts for 68% of the total crypto market and has a market capitalization of $ 433 billion with a current circulating supply of over 18.5 million Bitcoin .
The remaining market share is taken by Ethereum (10%), Tether and XRP (3% each), Litecoin (1%) and Cardano (0.76%) – all of them large-cap cryptocurrencies.
Bitcoin experienced a temporary slump in popularity and usage among retail investors in Q2 2020 as decentralized financial coins, networks and protocols (DeFi) saw increased interest and attracted investment from traders.
The period was marked by the rise of food tokens like KFC, YAM, SUSHI, HOTDOG, and a few others, with such protocols offering returns of up to 1,000% in some cases. Most of them failed, however, and the market has since moved on to seigniorage stablecoins.
However, some DeFi “blue chips” such as Yearn Finance, Synthetix, Aave, and others have continued to gain and maintain value and popularity.
But the king has since recovered. Bitcoin rose from under $ 11,000 in July and hit new highs in December. It exceeded $ 24,200 earlier this month after breaking key price levels such as $ 18,000 and $ 20,000 (its previous high).
The level of dominance has increased by over 100% since 2018, when the ICO frenzy of the time pushed Bitcoin to a dominance of only 32%. Ethereum rose to its highest level of 18% dominance at the time.
The big institutional bitcoin rush
Beginning in 2020, the narrative for Bitcoin turned for the better among traditional market players and institutional investment firms, with the ongoing pandemic and subsequent money printing fueling Bitcoin’s popularity among fund managers and investors.
Hedge fund manager Paul Tudor Jones raised up to $ 70 million in BTC futures in the first quarter of 2020, and other managers followed suit. In the past few months, Guggenheim Investments, Fidelity Investments, and Asian family offices have also announced that they are either buying BTC or are in the process of buying BTC.
But arguably the most significant purchase was that of corporate software manufacturer MicroStrategy. The company has been buying over a billion dollars worth of Bitcoin in various tranches since September to keep in its treasury, with CEO Michael Saylor tweeting regularly about the uses of Bitcoin ever since.
Such factors, coupled with a “supply-side crisis” (according to on-chain analysts) have done their part in the rise of Bitcoin in 2020.