Bitcoin’s market dominance in U.S. markets has reached an astonishing 71 percent. This surge in market dominance is the highest level it has achieved since October 2022, News About Nigeria reports.
This new development has captured the attention of investors and analysts alike, as Bitcoin’s dominance surpassed its previous peak of 66 percent, recorded in March 2023.
The cryptocurrency market, in response to this surge, has been infused with renewed bullish sentiment.
The surge in Bitcoin’s dominance on U.S. exchanges is backed by data from Kaiko, a prominent cryptocurrency data provider. According to their data, this increase to 71 percent was recorded last month, signaling a clear shift in the cryptocurrency landscape.
This resurgence in dominance hints at the possibility of a substantial influx of institutional traders into the Bitcoin market, possibly influenced by rising real yields and a deteriorating global risk sentiment.
Adding to the intrigue is the transition of Bitcoin’s cumulative volume delta (CVD) into positive territory towards the end of September. This indicates a prevailing trend of net buying, suggesting strong buying pressure supporting Bitcoin’s price, even after a brief dip below $25,000 in early September. The dip was triggered by FTX’s announcement of offloading its $3.4 billion crypto holdings as part of bankruptcy proceedings.
However, the recent capital injection into altcoin markets, fueled by the anticipated launch of nine Ethereum Exchange-Traded Funds (ETFs) in the United States, could temporarily disrupt this upward trend in Bitcoin’s dominance.
Taking a historical perspective, data from Kaiko reveals that September has traditionally been a challenging month for both conventional equities and cryptocurrencies.
Bitcoin itself has recorded negative returns in 8 out of the past 12 years during this month. Despite modest trading volumes and surging risk-free rates, Bitcoin managed to defy these historical trends, closing last month with a 4.7 percent gain.
QCP Capital, a respected crypto asset trading firm, expressed skepticism about the cryptocurrency’s future trajectory. They have suggested that Bitcoin might test the critical support level of $25,000 in the final quarter of 2023. Factors contributing to this outlook include the potential diversion of demand from the spot market due to approved Ethereum futures ETFs and lower-than-expected core PCE inflation.
