Bitcoin Dominance (BTCD)

Understanding Bitcoin Dominance (BTCD)

Bitcoin Dominance (BTCD) is the term used to describe the proportion of Bitcoin’s market capitalization compared to the total market capitalization of all other cryptocurrencies.

Bitcoin (BTC) is a digital currency that was introduced in 2009. It was created by an unknown individual or group known as Satoshi Nakamoto, who outlined its principles in a whitepaper. Bitcoin operates on the concept of decentralization, offering lower transaction costs compared to most online payment methods and differing from government-regulated fiat currencies.

Currently, Bitcoin is the most valuable cryptocurrency in terms of market capitalization and plays a significant role in trading activity on cryptocurrency exchanges. However, its dominance has decreased over time due to the emergence of new cryptocurrencies like Ethereum. While Bitcoin’s dominance was nearly 100% five years ago, it has now declined.

In 2013, Bitcoin faced limited competition and held a 94% market share. During that time, ERC-20 tokens and stablecoins did not exist, and Ethereum was still in its early stages of development.

However, the altcoin boom in 2017 resulted in a decrease in Bitcoin’s market dominance. By February 2017, Bitcoin’s market share had dropped to 85.4%, with Ethereum and Ripple’s XRP gaining market share.

Since then, Bitcoin’s market share has continued to decline as new coins and tokens enter the cryptocurrency markets. Currently, Bitcoin Dominance (BTCD) stands at 45.23% and is expected to decrease further.

Despite the emergence of other cryptocurrencies, Bitcoin remains the most popular and widely accepted digital currency. The price fluctuations of Bitcoin often impact the value of other altcoins, leading to a decline or increase in their value.

Bitcoin’s popularity has also contributed to its acceptance as a payment method worldwide. Transactions are processed using QR codes and can be easily integrated into existing payment methods such as credit cards and PayPal.

While Bitcoin transactions are recorded on a public network, the identities of buyers and sellers remain anonymous. Only their wallet addresses are accessible to the public. This anonymity makes Bitcoin a preferred method of payment for those engaged in illegal activities online.

Despite criticism from regulatory authorities, the popularity of Bitcoin continues to rise.