Bitcoin Dominance Drops To Levels Last Seen In July 2019
Quick Read
- Bitcoin dominance drops to levels last seen in July 2019 as crypto markets rally.
- Bitcoin rallied to nearly $13,000 in July 2019.
Bitcoin dominance measures the market cap of Bitcoin relative to the entire cryptosphere’s market cap. The cryptocurrency’s dominance is slipping as Bitcoin dominance drops to 62%, a level last seen in July 2019.
A drop in Bitcoin dominance may mean that altcoins are performing better than Bitcoin. The recent dominance crop can be largely attributed to Ethereum’s rally pushing its market cap to over $34 billion.
Crypto Markets Rally
As previously reported by The Crypto Associate, crypto bears are racking up losses as crypto markets surge. According to cryptometer.io, over $71 million in crypto shorts were liquidated on BitMEX alone. Unsurprisingly, the majority of the liquidation came from Bitcoin and Ethereum shorts.
Shorts allow traders to bet against the price of an asset and profit when the price falls. To short Bitcoin, a trader will sell Bitcoin at market price and then repurchase the Bitcoin once the price falls and therefore net the difference in price.
Some traders also utilize leverage trading which allows them to trade with more trading power. For example with 5x leverage traders can amplify gains at 5x the rate. However, losses are also amplified by 5x. Therefore, with high leverage, relatively minor price swings can result in millions in liquidations.
Many cryptocurrencies including Bitcoin and Ethereum have had a strong week. Ethereum is now trading at $307, up $72 from just one week ago. Furthermore, Bitcoin momentarily reached $10,000 on several cryptocurrency exchanges before dropping back to the $9,850 range.
Cover image by Lucas Benjamin on Unsplash
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