Bitcoin price has been outperforming the cryptocurrency market recently, as Ethereum’s ether and decentralized finance (DeFi) tokens experienced a decline. In the past 24 hours, BTC initially dropped to $28,100 before recovering to around $28,500. On the other hand, ETH showed weakness and fell by 1.8% to approximately $1,560, reaching a new 15-month low relative to BTC. The broader digital asset market, represented by the Market Index, saw a slight decrease of 0.6%.
DeFi Index Struggles
Among the various crypto sectors, the DeFi Index (DCF) struggled the most, experiencing a 3.7% decline. This was primarily driven by the native token of decentralized exchange UniSwap (UNI), which dropped by almost 7% following the announcement of a 0.15% fee on certain trades executed through its front end.
Sui Blockchain Token Plummets
The native token of the Sui blockchain (SUI) also plummeted by 7.6% due to concerns raised by the director of the South Korean Financial Supervisory Service regarding potential token supply manipulation through staking. The Sui Foundation denied these allegations, calling the report “materially false.”
Bitcoin Dominance Rate Increases
Bitcoin’s strong performance has led to an increase in its market share among all cryptocurrencies, known as the Bitcoin Dominance Rate, which now stands at over 52%. This is the highest level since April 2021. Investment advisory firm ByteTree suggests that this metric could rise further as market participants anticipate the approval of a spot BTC exchange-traded fund and the upcoming quadrennial halving of bitcoin in early 2022, which is considered bullish for its price.
ByteTree Analysts’ Perspective
According to ByteTree analysts, the current state of the crypto market is less risky than in the past two years. However, with the halving approaching, they believe that bitcoin will maintain its advantage for the foreseeable future.
Impact on the Crypto Market
The rise in the Bitcoin price has had a significant impact on the overall cryptocurrency market. As other digital assets struggle, Bitcoin continues to show strength and resilience. This has led to increased interest from investors and market participants who are looking for a more stable and reliable investment option.
Factors Affecting Bitcoin Price
Several factors have contributed to the recent surge in Bitcoin price. The anticipation of a spot BTC exchange-traded fund has generated excitement among investors, as it would provide easier access to the cryptocurrency market for mainstream investors. Additionally, the upcoming quadrennial halving of bitcoin is expected to have a positive impact on its price.
Conclusion
In conclusion, the Bitcoin price continues to outperform the cryptocurrency market, as Ethereum’s ether and DeFi tokens face declines. With the Bitcoin Dominance Rate at its highest level since April 2021, it is evident that Bitcoin remains a strong and attractive investment option for market participants. As the crypto market evolves and the upcoming halving event approaches, it is likely that Bitcoin will maintain its advantage for the foreseeable future.
