Some Thoughts on Bitcoin vs. Bitcoin Dominance

Bitcoin has been on a run! It's about to hit new all-time highs (or it already did). What was most surprising was how it crashed right before Thanksgiving only to spike and rip higher once again. Congrats to the resilience of this asset. Clearly people see the power and potential.

Now for this chart analysis I am looking at two charts side-by-side: Bitcoin Monthly chart and a Bitcoin Dominance chart. The Bitcoin monthly chart shows Bitcoin going all the way back to late 2011. This is the price of Bitcoin as shown with monthly candles or monthly bars. The Bitcoin dominance chart shows what percentage of Bitcoin makes up the entire crypto universe market cap. This is interesting because it effectively demonstrates if Bitcoin's market cap is going up faster than alts and other coins or vice versa. It can also show what market is stronger or weaker - Bitcoin or everyone else.

What I find most interesting is how alt coins have slowly taken market share from Bitcoin over the years. I personally think it is currently at a healthy ratio, although I could see Bitcoin losing some steam relative to altcoins. Here's an important note: Both assets can go up and succeed at the same time. The question is if one is outperforming the other.

This is where things get interesting. The ratio of Bitcoin's market cap to all other coins can continue to chop sideways and that's perfectly normal. Meaning, they're both moving at the same pace and keeping an equal share. In addition, I think it is in Bitcoin's best interest to have a healthy altcoin market. After all, they are all apart of the same universe of tradable assets. I don't think it's wise for just Bitcoin to rise and alt coins to lag. There needs to be a global bull market to confirm the entire crypto landscape, the rise of new projects, and the new standard being built to make the world better and create more efficient businesses, processes, and financial innovation. So actually, the real key, just might be in altcoins.

This is what I will be watching.

I will be eyeing Bitcoin's price, but more importantly I will be watching it next to its dominance. A healthy global market for all crypto assets is best. Let's see what happens and thanks for reading.