This is mainly due to the continuous records set by the price of BTC.
For example, this night a new all-time high was reached at around $28,500, slightly higher than the previous high set on December 27.
Right now there are very few major cryptocurrencies whose price is close to all-time highs. In particular, only Bitcoin Future review in the month of December has far exceeded the previous highs, while Binance Coin is more or less back to the levels of the highs recorded last year.
All the other main cryptocurrencies have prices below their historical highs, in some cases even very far away.
Therefore, it is inevitable that Bitcoin’s dominance will grow, although the third largest cryptocurrency by market capitalization, Tether (USDT), is at an all-time high in terms of market capitalization.
According to CoinMarketCap’s data, 2020 had opened with Bitcoin’s dominance at 68%, and closes with dominance at 70%.
The difference may seem minimal, but since very often the entire crypto market tends to follow the trend of bitcoin’s price, it remains the same significant.
Bitcoin’s dominance in history
Suffice it to say that in the first half of December 2017, i.e. while the last big speculative bubble was forming, bitcoin’s dominance was around 60%, despite the bubble involving the entire crypto market.
It touched a low peak at 32% in the middle of the following month, before the speculative bubble on altcoins burst and ended up bringing it back to 45% in April 2018.
Since then, however, it has slowly climbed back up, so that it was already back to 55% in September.
70% was reached again for the first time in September 2019, and since then Bitcoin’s dominance had always been below this threshold.
Therefore, the current level is the highest reached since the formation and bursting of the speculative bubble in 2017, so much so that for example in mid-September 2020 it had fallen to 56%, due to the boom in DeFi tokens.
In other words, the crypto market in the last months of this year was literally dominated by bitcoin, which returned to all-time highs not only in price, but also in dominance.
Tether’s CTO, Paolo Ardoino, said:
„Bitcoin’s dominance is inevitable after a tumultuous year that saw the king of cryptocurrencies increase in price from under $4,000 in March to a new all-time high of over $28,000. Although a growing institutional presence has been part of the narrative of the current bull run, we could see an increase in retail investor interest in Bitcoin as a form of digital gold. This could also bolster interest in the many innovative projects being implemented in the digital token space.“