Bitcoin market capitalization now accounts for a staggering 56.2% of the total digital asset market, up from a mere 38.7% in November 2022.
According to the latest data from Glassnode, this surge in Bitcoin’s dominance has come at the expense of other sectors within the ecosystem. Ethereum (ETH) has experienced a relative decline, with its dominance dropping from 16.8% to 15.2% over the same period.
The driving force behind this shift seems to be the unwavering belief of Bitcoin’s long-term holders. According to Glassnode, ever since the market cycle low in November 2022, capital has kept accruing toward the major asset end of the digital asset risk curve with considerable accumulation pressure below the surface.
Notably, in this March 2024 all-time high, the Realized Profit / Loss Ratio of Long-Term Holders has reached similar altitudes to prior market tops. In both the 2013 and the 2021 cycles, the metric has declined to approximately similar levels before resuming an uptrend in price. However, it went one-way in 2017-18 since the market entered a loss-dominant bear market.
Bitcoin HODLing outpaces long-term holder spending
The report further observes a decrease in the spending of Long-Term Holder, with LTH supply now increasing at a rapid pace. This means that HODLing behavior has been a lot more than spending behavior which in turn is making Bitcoin the most prominent asset in the digital world.
While the market is going through these investor cycles, the report points out the great need to measure unrealized and realized losses, particularly for short-term investors. The data denote that the impact on investor sentiment might not be as great as it may at first appear. This resembles the situation of the 2016-2017 cycle.
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