Bitcoin’s dominance over the broader cryptocurrency market grew on Monday, as the BTC price reached fresh six-week highs amid tepid trading conditions for other assets.
Bitcoin Price Update
The bitcoin price reached a high of $7,741, according to CoinMarketCap, gaining nearly 4% over the previous day. The largest cryptocurrency by market capitalization consolidated around $7,705, its highest since early June.
By crossing $7,700, bitcoin is inching closer to $8,000 – a key psychological milestone. Breaching this level could generate a sustained push toward $10,000 in the short term.
At current price levels, bitcoin has a total capitalization of $132.2 billion, or 46% of the entire cryptocurrency market. Bitcoin’s dominance index hasn’t been that high since December following its peak near $20,000.
Twenty-four hour trade volumes spiked 44% to $4.9 billion, a sign that the latest rally has further room for growth. Trade volume is a key indicator of liquidity and underlying investor interest – two features the bitcoin market has generally lacked in recent months.
Bitcoin was responsible for virtually all of the market-cap growth in cryptocurrencies on Monday. Excluding bitcoin, altcoins were valued at $154.8 billion, virtually unchanged from 24 hours ago. With bitcoin, the market gained nearly $6 billion to $287.1 billion.
Factors Behind the Rally
Bitcoin’s multi-week uptrend began with the successful defense of $6,000 – a major inflection point for traders – and a series of minor rallies eventually paved the way for last Tuesday’s double-digit surge. Bitcoin’s 17% week-on-week return is upstaged only by Stellar Lumens, which gained 26% over that period.
In addition to technical factors, bitcoin has enjoyed greater regulatory clarity after the U.S. Securities and Exchange Commission (SEC) deemed the cryptocurrency to be “sufficiently decentralized” not to classify as a security. This puts bitcoin in a coveted class of blockchain assets that are not regulated by the SEC.
Attempts to securitize bitcoin are also being considered by the SEC, The securities regulator is expected to decide on the fate of a bitcoin exchange-traded fund (ETF) as early as next month.
Bitcoin is also benefiting from positive speculation that major industry players are looking to enter the cryptocurrency market. Last week, That BlackRock has set up a working group to explore cryptocurrencies and blockchain technology. The hedge fund controls more than $6 trillion in assets.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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