Bitcoin now accounts for half of the total crypto market cap – crossing 50% dominance for the first time since April 2021.
The chart below shows Bitcoin dominance finding a local bottom at 39.9% around November 2021 – when FTX, and its native FTT token, collapsed, triggering narratives around worthless altcoins and Ponzinomics.
Since then, BTC.D has been trending upwards, jumping to 47.7% from 43.5% in mid-March, as banking weakness flipped investor sentiment toward ‘hard assets.’
Another sharp uptick occurred in early June, moving from 47.4% to close the first week of the month at 49.1%, as U.S. regulatory enforcement actions intensified.
Bitcoin holds steady
As reported by CryptoSlate on June 12, the Securities Exchange Commission (SEC) enforcement actions against Binance and Coinbase coincided with another uptick in Bitcoin dominance.
In separate filings, the SEC alleged that both exchanges had violated securities laws, including operating as unregistered exchanges and offering unregistered securities.
Across the two filings, 19 altcoins were named as unregistered securities by the agency. They were ATOM, BNB, BUSD, COTI, SOL, ADA, MATIC, FIL, SAND, MANA, ALGO, AXS, CHZ, NEAR, FLOW, ICP, VGX, DASH, and NEXO.
The altcoins above suffered depressed price action. For example, since the SEC filing, BNB saw a peak-to-trough drawdown of 28%. Similarly, the next largest altcoin named in filings, ADA, experienced a peak-to-trough fall of 42%.
Meanwhile, Bitcoin has remained relatively steady over the same period, losing 8% in the peak-to-trough move triggered by SEC enforcement actions.
Commenting on the situation, editor at Adamant Research Turr Demeester said that although the Bitcoin dominance metric has flaws, the uptrend is still noteworthy. He added that an inevitable aspect of Bitcoinization “is for “crypto” to scatter in the wind.” With that, he signed off by saying:
“The public is at long last learning to discern fool’s gold from the real deal.“
However, the trend does not yet appear to be present within crypto ETP investments, as CoinShares revealed in its latest weekly report. Altcoin ETFs, including tokens such as Cardano (ADA) and Polygon (MATIC,) saw inflows, while Bitcoin and Ethereum saw net outflows over the past week.
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