Data shows the altcoin dominance by volume on exchanges has now risen to 50%, here’s what happened to Bitcoin the last two times the crypto market saw such a shift.
Altcoins Now Make Up 50% Of All Volumes on Exchanges
A CryptoQuant analyst pointed out this fact postAltcoins are now the dominant cryptocurrency after Bitcoin was no. 1 for a whole month.
The relevant indicator here is the “trading volume,” which is a measure of the total amount of coins being traded on centralized exchanges.
The percentage to this total trading volume being contributed by an individual crypto is called its “dominance by volume.”
Below is a chart showing how Bitcoin, Ethereum and other altcoin dominances have performed over the past month.
Source:| Source: CryptoQuant
As shown in the graph, Bitcoin was the most popular cryptocurrency for a large portion of the month. But, that trend has changed over the last few weeks.
BTC’s dominance of the trading volume dropping off has given more room to the altcoins, who now contribute to around 50% of the volumes on exchanges.
As for Ethereum, the crypto’s volume hasn’t observed any significant shifts recently, with the coin’s dominance moving sideways just below the 30% mark.
Two periods in the past year have seen altcoins enjoy a similar dominance. The chart below shows how Bitcoin prices behaved over these periods.
Source:| Source: CryptoQuant
From the graph, it’s apparent that the first of these altcoin dominated periods occurred back between November 2021 and January 2022. The Bitcoin price was $67k at the beginning of the time span, but it had fallen to $36k by the end.
This was the second stretch of high altcoin volumes that took place between April-June of this year. Much like the first, BTC saw a significant drop in price from $47k down to $20k.
If altcoins continue to dominate trading on exchanges and a similar trend follows now, it could be trouble for Bitcoin.
Bitcoin price
At the time of writing, Bitcoin’s price floats around $19.3k, down 1% in the last week. The crypto has seen a 1% increase in value over the last month.
BTC remains stuck in consolidation Source:| Source: BTCUSD on TradingView
Featured image of Traxer from Unsplash.com, charts by TradingView.com, CryptoQuant.com