What is Bitcoin Dominance?

Bitcoin's dominance is estimated as the proportion of bitcoin's market capitalization in relation to the rest of the digital currency market.

Some cryptocurrency investors use bitcoin's dominance as a handbook

Although there are now many altcoins out there, bitcoin, the first cryptocurrency, has remained the largest computerized resource

Some began to involve the predominance of BTC as an aid to their exchange behavior.

Specifically, the dominance of BTC is accepted to offer insight into what direction the market will take.

You can calculate Bitcoin's dominance with the following formula:

BTC dominance = BTC market capitalization / Total market capitalization of all cryptocurrencies

What can influence Bitcoin's dominance?

Changing market trends

Bull Market or Bear Market

Buying fiat money through stablecoins

Emergence of new cryptocurrencies

The dominance of BTC is an instrument to help reveal information about how market cycles are evolving.

Note that the dominance of BTC does not guarantee the performance of bitcoin or any other cryptocurrency

But it works as a manual to help investors organize their trading approach.