- Bitcoin dominance hits 58% YTD high as altcoins like Ether drop 30% amid market turmoil.
- Jump Crypto’s massive Ether sell-off triggers 20% price plunge, shaking crypto markets.
- Geopolitical tensions and economic data fuel crypto volatility, Bitcoin now 58% of market cap.
Bitcoin dominance, the ratio of Bitcoin’s market capitalization to the entire crypto market, has set a new year-to-date high of 58%. It rose to a high of 58.1% in the early hours of August 5 after a sharp sell-off that saw Ether tumble by 18% within two hours and BTC fall by 10% in the same time frame. This was triggered by a massive selloff in altcoins and global stock markets, which crumbled.
Bitcoin Drop Impact on Altcoins
As Bitcoin’s value rises, price variations affect the rest of the cryptocurrency business. A prolonged drop in Bitcoin’s price may increase selling pressure on several cryptocurrencies.
According to CoinGecko data, the price of Ether has fallen 30% in the last seven days, while prominent altcoins such as Solana have fallen 35%, 25%, and 21%, respectively.
Analysts speculate that the sell-off in altcoins and subsequent gain in Bitcoin’s market share may reflect a flight to quality or a move to more cautious investing tactics among crypto investors during periods of economic uncertainty and geopolitical turmoil.
Factors behind Bitcoin and altcoin fall
Hostilities between Israel and Hezbollah have been ratcheting up, with increased military posturing in the area by the U.S. putting things, particularly on edge, which now brings a further squeeze on markets that have recorded losses across asset classes.
Concurrently, Trading activity has hugely driven the latest market dynamics. More specifically, Jump Crypto, the cryptocurrency trading division of Jump Trading, caused Ether to lose 20% of its value. On Sunday, Jump Crypto sold off large amounts of its holdings in Ether, moving millions worth of the asset to hot wallets on various exchanges, such as Coinbase, Binance, OKX, and Bybit. All these fueled massive selloffs, and the digital token, Ethereum lost all its annual gains and now trades at about $2,351.
Another major economic data print is the ISM Manufacturing Purchasing Managers Index report, which clarifies economic trends and investor sentiment. Whether these indicate expansion or contraction could further affect the dynamics in the markets by either stabilizing the current uncertainty or adding to the volatility of the markets.
According to the latest data, despite this drop, Bitcoin currently accounts for 58% of the crypto space’s market capitalization.
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