There are always interesting developments in the world of cryptocurrency. Contrary to what people expect, the Bitcoin Dominance Index continues to decline. This appears somewhat odd, considering this is still the world’s largest cryptocurrency. At the same time, cryptocurrency is about so much more than Bitcoin. Anyone looking for anything but a digital store of value clone of gold is better off disregarding Bitcoin. The current network issues have taken their toll on Bitcoin’s status.
It is good to see more competition in the world of cryptocurrencies. More specifically, Bitcoin is far from a perfect form of digital money. A slow network, little scaling progress, and high fees are just some of the problems. Investors are taking notice of these problems and look for alternatives. Interestingly enough, those alternatives do not come in the form one would expect. Ethereum is approaching a new all-time high, yet lacks the popularity it once had. Bitcoin Cash is facing some minor setbacks as well right now.
Bitcoin Dominance Index is an Incomplete Statistic
Instead, investors flock to less-traditional forms of money. Ripple’s XRP, Cardano, and Stellar Lumens are all of the rage right now. Even NEM is making a lot of waves these days, even though none of these currencies are necessarily designed for regular consumers. From an investment point of view, they are far more suited than Bitcoin as well. Their room for future gains is a lot larger than one would expect. How all of this will play out, remains to be determined.
As a result, we see the Bitcoin Dominance Index dwindle even further. Earlier this week an all-time low of 37% was reached. An interesting development, although only a sign of things to come. Right now, this same Bitcoin Dominance Index sits at just under 35%. This is all despite the Bitcoin price reclaiming the $15,000 level, mind you. Unfortunately for Bitcoin, it’s becoming less and less relevant. This is not something most people had expected to happen at this point in time.
How all of this will play out, remains to be seen. The Bitcoin Dominance Index is not necessarily the best metric. It does show altcoins are cementing their legacy regardless of what Bitcoin is doing. Diversification is critical in the world of cryptocurrencies. Right now, people are taking that advice to heart. It is important to put your eggs in different baskets. Bitcoin has had a good run, but for now, it will remain stuck in sideways trading momentum. This will benefit altcoins tremendously, all the while the Bitcoin Dominance Index continues to slide.
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