over 2 years ago • 1 min
As the cryptocurrency market matures and developers launch dozens of new tokens each day, bitcoin’s all conquering influence is waning.
As the chart shows, bitcoin’s weight in the crypto market has sharply declined this year, dropping to just 41% from 70% at the end of 2020. That’s not far off the record low of 37% set in January 2018 as the last great crypto bull market ended.
While the market value of all bitcoin in circulation has climbed about 50% this year, the value of the long tail of crypto projects – from Polkadot to Solana to Axie Infinity – has exploded even faster, pushing crypto’s overall market capitalization to about $2 trillion.
This reduced dependence on a single token is arguably healthy for the crypto ecosystem overall. But it undermines bitcoin maximalists’ claims that its fixed supply of 21 million tokens will inevitably push up prices far into the future. As crypto demand is spread across more and more projects, bitcoin demand may slowly recede.
And if crypto investors grow increasingly comfortable purchasing non-bitcoin cryptos – sometimes still dismissively labelled as “altcoins” – it seems possible bitcoin’s influence over the world of crypto could slip even further.
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