Bitcoin dominance back at 2021 high, boosted by ETFs

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The significance of Bitcoin in the world of cryptocurrencies is currently at its highest point in the last three years, largely due to increased demand for US-based Exchange Traded Funds (ETFs).

Based on data from CoinMarketCap, Bitcoin (BTC) made up around 55% of the total $2.4 trillion value in the virtual currency market during April 2021. Following Bitcoin were Ethereum (ETH), Tether (USDT), Binance Coin (BNB), and Solana (SOL) with significant market shares.

In the past few weeks, new Bitcoin-focused exchange-traded funds (ETFs) from firms like BlackRock and Fidelity have seen significant growth, amassing approximately $56 billion in assets. This surge in investment caused BTC‘s price to reach an unprecedented peak of $73,798 around mid-March.

Smaller digital assets have dropped more than 30% in value, while the coin’s price has decreased about 6%, due to waning hopes for easier US monetary policies which tend to fuel investment speculation.

Institutional investors’ investments in U.S. Bitcoin ETFs have caused Bitcoin to outperform other market assets remarkably, according to Benjamin Celermajer, Magnet Capital’s director.

An extra development: The addition of Bitcoin and Ethereum exchange-traded funds (ETFs) listed in Hong Kong has caused a spike, with Bitcoin climbing 4.3% to $66,575 and Ethereum rising by 6.2% to $3,260. This growth has also benefited other cryptocurrencies such as Polygon, Cardano, and Dogecoin.

The market is paying close attention to the upcoming token halving in late April, which will reportedly reduce the fresh supply of coins by half. Previous halvings have led to price surges, but it’s unclear how the current event will affect the coin due to its recent impressive performance.

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2024-04-15 18:51