The reversal event could, in fact, occur next year if Ethereum keeps the same growth rate
Bitcoin dominance on the market has dropped significantly back to 2018 levels after Ethereum’s capitalization growth amplified this year.
Fall of Bitcoin’s dominance
During the year 2021, Bitcoin’s dominance declined significantly from 69% at the start of the year to 40% in December. Although Bitcoin remains the most popular cryptocurrency for the part of the world not involved in digital assets, it still hasn’t achieved the same growth rates as Ethereum.
During the entire year, multiple events that have supported Bitcoin’s growth on the market, including the approval of the first U.S. Bitcoin exchange-traded fund backed by futures contracts.
The last time Bitcoin struggled to maintain the rate of growth was in 2017, or during the “ICO era”, when Ethereum-based coin offerings were rapidly gaining popularity, placing the second largest cryptocurrency on the market extremely close to the Bitcoin market. capitalization.
Ethereum capitalization spike
Ethereum dominance on the market has been continuously moving up as the year passes by gaining 11% market dominance since January. It totals 22% at press time. The main reasons for Ethereum’s growth were an NFT rally in the middle of the year, implementation of the fee-burning mechanism and the overall rise of DeFi solutions.
With more and more use cases appearing on the Ethereum blockchain, more and more people are starting to use it, which means they have to buy a certain amount of Ethereum coins to use decentralized applications such as the hits NFT or DeFi platforms.
At press time, Ethereum is trading at $4,321 after dropping to $3,400 recently, and Bitcoin trades slightly below $50,000, failing to show the same recovery rate as Ethereum that gained back 25% of the value within a day after dropping to a two-month low.