Bitcoin dominance hits new cycle high as post-election altcoin rally fizzles out: Matrixport

Bitcoin’s domination has reached a new high cycle despite pricing, while investors go from altcoins, driven by stronger than expected American employment and the bellicist position of the federal reserve.

According to MatrixBitcoin (BTC) Domination has reached a new high cycle, exceeding 61%. Matrixport attributed this to two factors: an American job report stronger than expected as well as the increasingly fellow position of the federal reserve. When employment growth exceeds expectations, this suggests that the economy works well. This often results in higher interest rates or delay in rate drops, which reduces liquidity on the financial markets. Higher interest rates then make borrowing more expensive, encouraging investors to switch alt parts to safer assets (hence the increase in Bitcoin Dominance despite the Price correction). According to the Matrixport graph, the dominance of the BTC was 60.3% on November 5, but it fell at% 53.9 on December 9, while Altcoins jumped after the US elections in November.

This change is also reflected in the global trend in market capitalization of cryptography. According to the Matrixport graph, total market capitalization experienced an increase during the Altcoin rally in November but began to decrease while Bitcoin has regained domination. In early March, Crypto Marketcap crashed considerably compared to its post-electoral peak of 3.8 billions of dollars in December (when the domination of the BTC was approximately 53%) at around 2.9 billions of dollars. This represents a drop of around $ 900 billion, which highlights a significant contraction in the liquidity of the cryptographic market.

Despite this, Bitcoin has remained relatively resilient compared to altcoins. To put it in perspective, the price of Bitcoin decreased by 24% compared to its summit of $ 109,000 reached in January. Ethereum (Ethn), however, fell to $ 1895 in the last month, while Solana (GROUND) Bled 39% during the same period.

Despite its relative resilience, however, the correction of Bitcoin prices aligns with the drop in market capitalization, which suggests that liquidity is in its price. Due to the position of the federal reserve, Matrixport analysts believe that it will be difficult for Bitcoin to maintain significant price increases based solely on increased liquidity. Any other gain will probably take “more patience”, which means that investors will have to wait longer and the increase will probably be progressive. Fed shares could counter the positive effects of increasing liquidity.