Bitcoin’s dominance of total cryptocurrency market capitalization soared to 49.6%, its highest level since late April 2021 and a 111-week high.
The period around April 2021 is associated with the first wave of the previous bull cycle, with BTC peaking at $65,000 by early April 2021.
Despite China’s crypto ban and Elon Musk’s rant on the green qualification of bitcoin miners, which hit a bottom of $28,900 by June 2021, the second wave will see these losses. and peaked at $69,000 by November 2021, marking the peak of the cycle.
At the moment, the selling pressure has pushed the total outflow of market capitalization to just under 50% on June 10th. $61.8 billion – Bottom at $1.38 trillion by Saturday evening (BST).
The drop is probably a belated response given the growing severity of last week’s SEC lawsuit, especially the potential delisting of altcoins from all US exchanges.
Last week, the SEC filed charges against Binance and Coinbase, including charges of operating unregistered exchanges and providing unregistered securities to U.S. citizens.
Bitcoin relatively unaffected
Bitcoin has remained relatively stable, declining 3.5% in value over the past seven days, despite a sharp drop in total crypto market outflows.
Last week, The Sandbox, Decentraland and Axie Infinity were the biggest losers in the Top 100, down 36%, 34% and 33% respectively. The 24-hour fluctuations for the three tokens are 0.3%, 0.5%, and 0.6% respectively, suggesting continued market uncertainty after the significant price drop.
The U.S. Securities and Exchange Commission has named SAND, MANA and AXS Securities in both the Binance and Coinbase lawsuits. The SEC has designated 19 tokens as securities, including large cap stocks such as SOL, ADA and MATIC.
The chart above shows Bitcoin dominance reversing its downward trend around September 2022. FTX’s demise has painted an unfavorable narrative around a “token made from nothing” unlike BTC, which is backed by its perceived energy consumption and decentralized network.
Coupled with Bitcoin’s commodity status, we can expect some protection from regulatory adversity, and as a result, BTC’s dominance is poised to rise even further in line with the altcoin flight.
