Bitcoin prices have been maintaining stability, even as many alternative protocol assets or “altcoins” suffer notable declines.
These sharp declines have pushed the value of the digital currency market to as little as $186.2 billion today on CoinMarketCap.
At this point, the broader market has fallen to its lowest value since November 2017, additional CoinMarketCap figures show.
In addition, it is down more than 75% from its all-time high of more than $830 billion reached in January.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
“There seems to be movement to Bitcoin as the safe haven in the market,” said Charles Hayter, co-founder and CEO of digital currency data platform CryptoCompare.
“Bitcoin drives the market,” noted Marouane Garcon, managing director of crypto-to-crypto derivatives platform Amulet.
“If Bitcoin isn’t doing well then the alts typically don’t do well,” he stated. “If Bitcoin is doing well then everyone dumps their alt coins and converts to Bitcoin.”
While many traders have faith in Bitcoin‘s ability to withstand the test of time, they might not be as convinced when it comes to other digital currencies, he asserted.
“The sentiment is that some of these alts won’t recover after this bear market whereas everyone generally believes Bitcoin will return to glory,” said Garcon.
“So it’s a safe haven in a sense that traders typically believe it’s going to go up in value over other coins.”
Bitcoin Dominance Index
Bitcoin was the first digital currency to scale, and as a result, some analysts have claimed that this particular cryptocurrency benefits from the first-mover advantage.
Bitcoin is such a large part of the broader digital currency market that CoinMarketCap has created the Bitcoin Dominance Index, which measures the digital asset’s share of the market.
Today, this index surpassed 58%, meaning that Bitcoin‘s market capitalization made up close to 60% of the total value of the broader cryptocurrency market, its highest share since last December.
After reaching an all-time low in January of close to 30%, the Bitcoin Dominance Index has been following an upward trend.
“People want exposure” to the digital currency markets, claimed Hayter.
“Whilst searching for yield in Alts is not in vogue at this present – having a foot in the game with Bitcoin is.”