For the first time ever, Bitcoin's stranglehold on the cryptocurrency market cap has shrank below the 50% threshold.
This is very big news considering Bitcoin has accounted for more than 90% of the total cryptocurrency market cap for many years. It is even bigger news when you take into account that Bitcoin has also been increasing in value during this time period when it's losing market cap share.
So, Bitcoin is not losing it's stranglehold on market cap because it's losing value, it's losing it's stranglehold because everyone else is gaining in value at a faster pace.
Which means the Pie is growing big time!
Here is a chart showing Bitcoin's percentage of cryptocurrency total market cap:
Why is Bitcoin losing it's grip on the space?
1. Ethereum is rising quickly - For a while now Ethereum has had the second largest market cap in the space. However, that hold was in the single digits. Recently after a parabolic move took the coin from single dollars to almost $100 a coin, it's market cap share has inched up close to 20%.
2. Speculation in the space is driving up prices - It is impossible to throw a stick without hitting a cryptocurrency that is up 100's of percent in the last couple months. The entire space has been on fire. Many speculators, fearing they already missed the move in Bitcoin, are flocking to altcoins hoping some of them can repeat Bitcon's price performance.
3. New ICO's are coming online daily - As the popularity and interest in the space has increased, so have ICO's. Something like $380 million has been raised recently through ICO's and that number is only looking like it is going to increase. More and more money is entering the space and finding a place to go besides Bitcoin.
4. Bitcoin's development has slowed - Compared to many of the newer altcoins, Bitcoin is a bit of a dinosaur. It was the first in the space, but it's technology is lagging. Transaction fees have gone from $.11 to $1.70 in the last year. The time to confirm a transaction is over 20 minutes at this point. Compared to steem, which has no transaction fees and processes transactions in under 3 seconds, it's technology looks ancient...
5. Newer projects offer more than just a currency - A lot of these newer projects are offering technology that is more than just a currency. As these new technologies enter the space they are bound to increase the overall money involved in the space and continue to narrow bitcoin's dominance of it.
Conclusions:
All of this doesn't mean that Bitcoin can't keep going up, it probably will. It just means that Bitcoin's days of dominating the space are likely over.
Lots of new money is coming into the space and likely will continue to do so and that is great news for anyone involved in other blockchain projects, such as steem.
Steem on my friends!
Sources:
https://www.forbes.com/sites/laurashin/2017/05/16/for-first-time-bitcoin-accounts-for-less-than-half-of-market-cap-of-all-cryptocurrencies/#2e686a326fbe
Image Sources:
http://www.coindesk.com/the-dao-bitcoin-development/
https://www.forbes.com/sites/laurashin/2017/05/16/for-first-time-bitcoin-accounts-for-less-than-half-of-market-cap-of-all-cryptocurrencies/#2e686a326fbe
