Bitcoin Dominance Ratio Hits Almost 60% in August, the Highest Share Since Early 2021

Despite significant price swings and fluctuations seen in April, June, and the first weeks of August, Bitcoin’s value has still jumped by roughly 51% year-to-date, adding nearly $450 billion to its market cap. Bitcoin’s impressive performance and a double-digit price gain have also significantly impacted its dominance ratio, pushing it high above the levels seen last year.

According to data presented by Stocklytics.com, Bitcoin’s dominance ratio hit nearly 60% in August, the highest share since early 2021.

The Last Time Bitcoin’s Dominance Ratio was Above 60% was in February 2021

As one of the oldest and most investigated metrics in the crypto world, the dominance ratio measures the coin’s market cap relative to the overall crypto market, showing how strong Bitcoin is compared to altcoins. Moreover, the figure resembles a trading sentiment, revealing whether Bitcoin is losing out on functions offered by stablecoins or NFT tokens.

Although the world’s largest and most expensive cryptocurrency ended 2023 with an impressive 160% gain, or three times more than its price growth in the past eight months, its dominance ratio was still much lower than this year. Although the surging institutional interest in Bitcoin, including major financial firms like BlackRock and Fidelity, significantly helped it recover from the 2022 bear market, Bitcoin’s dominance ratio was barely above 50% most of last year.

According to Coingecko and Statista data, it stood at 40% in January 2023, with altcoins holding roughly 60% of the market. Over the next four months, this figure rose by only 5% despite Bitcoin’s price surging. Statistics show Bitcoin’s dominance ratio climbed to 50% in October but then slipped to 47% by December last year.

However, things changed in 2024, showing that Bitcoin became much stronger than all other cryptos in the market. Statistics show the dominance ratio of the world’s largest crypto floated between 48% and 53% between January and June, amid the rumors of central banks halting or potentially lowering interest rates in the future, and then jumped to almost 60% in the first week of August, the figure last seen in February 2021. Although Bitcoin’s market share in the crypto space slipped to roughly 53% since then, this still represents a 6% increase compared to the same month last year.

Binance Coin and Solana are the Only Other Major Cryptos that saw their Dominance Ratios Grow

The Coingecko data also showed that only two more major cryptos besides Bitcoin, based on their market share in the crypto space, saw their dominance ratios grow this year.

Solana’s dominance ratio more than tripled in the past eight months, rising from 0.78% in January to roughly 3% last week. Binance Coin follows with a much smaller increase, with its dominance ratio rising from 3.1% to 3.5%, showing a steady but less dramatic growth in market share.

While Bitcoin and a few other major cryptos saw their dominance ratios grow, the majority experienced a decline. Ethereum’s market share dropped from 18.1% to 14.6% in this period, indicating a shift in market sentiment. Tether’s dominance ratio also decreased, falling from 6.5% to 5.2%. Statistics show XRP now makes 1.4% of the total crypto market cap, down from 2.7% in January, while Dogecoin saw its dominance ratio decline from 0.88% to 0.7% over the past eight months.