Bitcoin dominance soared in 2019, but Binance Research posits a pullback


Bitcoin

After more than one decade, Bitcoin continues to be the market leader according to its share of overall crypto market capitalization. Yes, dominance dropped drastically during 2017, when altcoin development projects flooded the market, but Bitcoin had clawed its way back to a 50% share by the close of 2018. It remained so until this April, and then BTC rocketed to a 70% share, a show of force that left altcoins gasping for air. A few consulting firms had predicted this dominating aspect of Bitcoin, but this prediction was predicated on many development programs failing to deliver successful use cases.

No one had ever believed that the world’s favorite digital asset would suddenly gain the support of institutional investors in a big way and soar to heights not seen in quite some time. From its bottom in December of $3,130, Bitcoin has more than tripled in value, to the amazement of onlookers. It currently is hovering about $10,300, while its market share just barely dipped below 70%, as depicted in the Coinmarketcap.com chart presented below:

A.T. Kearney, a global consulting firm with over $1 billion in annual revenue turnover, was one of the groups that had forecasted a return to glory by Bitcoin in 2019, but even their analysts had set the bar at 67%, not higher. We reported last December that their report had said:

By the end of 2019, Bitcoin will reclaim nearly two-thirds of the crypto-market capitalization as altcoins lose their luster because of growing risk aversion among cryptocurrency investors. More broadly financial regulators will soften their stance towards the sector.

In the midst of altcoin carnage or rather superior Bitcoin performance, Binance Research has released a report that suggests that Bitcoin will pull back. When BTC recently crossed over the 70% milestone, it was the first time it had witnessed that level in 29 months, all the way back to March of 2017, when one BTC was only worth about $1,000. Per the folks at Binance Research, as reported by CryptoGlobe:

BTC dominance will go back down to the 50-60% range. We still believe in this, partly because BTC dominance was below 60% for an extended period, from May 2017 until June 2019.

The report may give altcoin hodlers cause for celebration. They have been waiting patiently for history to repeat, such that, when Bitcoin pulls back, altcoins would typically rally, a period sometimes referred to as “altcoin season”. This mythical “alt-season” has not materialized in 2019, to the dismay of its potential benefactors. At least two respected crypto analysts/traders do not hold out hope. Their tweets are discouraging:

  1. Max Keiser: “Alts never coming back… Sorry.”
  2. Peter Brandt: “When will altcoin junkies understand that $BTC is the crypto with real and lasting value. Altcoins are to Bitcoin what lead is to Gold… 99% of cryptocurrencies will be forgotten five years from now.”

Binance Research, however, argues that resurging altcoins are a necessary ingredient for crypto prosperity in the future. Their report concludes:

BTC price increases help overall crypto adoption, and altcoin performances remain mostly dependent on projects themselves. For the whole crypto industry to develop, though, we feel that altcoins must be an integral part of the maturation process.

Other recent Bitcoin news include:


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Bitcoin dominance soared in 2019, but Binance Research posits a pullback

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