Ether Dominance Rises as Altcoins Outperform Bitcoin
Cryptocurrency markets lit up over the past week, with all but three top-100 digital assets booking gains
blockworks exclusive art by axel rangel
- Ether now makes up 18.7% of all cryptocurrencies, its highest point since May
- Bitcoin dominance dropped slightly after leading altcoins outperformed the top digital asset
Cryptocurrency prices glittered — at last — bright green over the past week, giving the industry a long-awaited reprieve from the brutality of the ongoing bear market.
Digital assets have added nearly 16% to their collective capitalization since last Friday, representing nearly $143 billion in nominal value.
Altogether, cryptocurrency is now worth $1.045 trillion, per TradingView’s Total Crypto Index, down 52% from the start of the year.
But gains were seen practically across the board, with almost every top-100 cryptocurrency by market value making ground.
LDO, the governance token for liquid staking community Lido, led the pack with an 80% price explosion. The project this week pledged to expand across the entire Ethereum layer-2 landscape.
Long-serving blockchain forks came in second and third. Ethereum Classic (ETC) surged 75% amid speculation that ether miners might move to the network following its impending switch to proof-of-stake, while Bitcoin Gold (BTG) added 50% to its price without any clear narrative.
LDO, ETC and BTG were respectively trading 46%, 24% and 42% below their prices from the start of the year, as of 12 pm ET.
Stablecoin dominance shrinks alongside bitcoin’s
Yuga Labs’ ApeCoin (APE), set to power its upcoming Otherside metaverse, grew by 43% off the back of a well-received demo; DeFi ecosystem Gnosis’ native token GNO jumped 38%; ether (ETH) spiked 35%.
Recent data from Glassnode shows ether deposits on crypto exchanges have hit a four-year low, as holders pile into the network’s Merge contract in anticipation of yields. Bitcoin (BTC), on the other hand, rose 15% — from about $20,600 to $23,700.
APE, GNO and ETH are now respectively down 22%, 73% and 56% in the year to date. BTC has tanked 49% so far in 2022, which has been defined by some of the most turbulent macroeconomic conditions of the past few decades.
“Yes, the European [Central] Bank raised rates for the first time in a long time. Yes, the Federal Reserve is also cranking up rates. And, yes, liquidity is getting tighter. This has been punishing for Bitcoin and risk assets more generally,” Ganesh Swami, CEO of blockchain data firm Covalent, said.
Added Swami: “It will remain difficult until the Fed can bring down inflation, or if the Fed just gives up on fighting inflation. Either way, it will likely be a difficult few months for markets, especially if Europe’s energy crisis worsens.”
He expects bitcoin to surge once quantitative easing eventually resumes.
Still, only three top-100 cryptocurrencies (sans stablecoins and wrapped tokens) lost value over the past week.
Arweave, the token that drives the decentralized storage protocol of the same name, fell 1%; Solana-powered decentralized exchange (DEX) token serum dropped 4%; and VR digital asset CEEK sank nearly 21%.
In fact, ether’s recent rally has brought its dominance (which measures how much of the digital asset market is ETH) to its highest point since May, having jumped 16.5 percentage points to 18.7%. Bitcoin dominance fell slightly, from 43.5% to 43.1%.
Stablecoin dominance also dropped as traders exited their safe havens in search of profits. The top four stablecoins — Tether, USD Coin, Binance USD and MakerDAO’s DAI — together made up 14.2% of crypto last Friday; now down to 12.35%.
Don’t miss the next big story – join our free daily newsletter.