- Bitcoin volume dominance on US exchanges rose from 29% in January to 44% in June 2023.
- The volume dominance reflects the market sentiment among crypto users in the U.S.
- Kaiko notes that the lawsuits filed by the SEC have upended the U.S. crypto market.
According to Kaiko, the leading market data platform, the Bitcoin volume dominance on U.S. exchanges rose from 29% in January to 44% in June 2023. Kaiko’s data provide an overview of the prevailing sentiment among crypto users concerning their exposure to altcoins.
Additional information from Kaiko indicates that the recent lawsuits filed by the Securities and Exchange Commission (SEC) against Binance and Coinbase have upended the U.S. crypto market. The allegations involved multiple crypto projects comprising some of the top altcoins. Hence, the perceived migration of crypto users from altcoins to Bitcoin.
There is an alternating behavior between Bitcoin and altcoins. Both exhibited contrasting trends in the initial days of cryptocurrency development. Many crypto investors adopted one as a hedge against the other, depending on the market trend. This condition prevailed until the introduction of stablecoins. Many investors today use stablecoins as safety instruments during heightened volatility or market uncertainty.
However, risk-averse investors who are more experienced in navigating the crypto market maintain the old system of alternating between Bitcoin and altcoins. Such alternating patterns result in a shift in market share common to the crypto market.
The recent lawsuits by the SEC described several altcoins as securities. If the judge agrees with this view, then the altcoins will be subject to regulation by the SEC. That is the situation, even when the protracted legal battle between the SEC and Ripple has not ended. The outcome of this development is a heightened FUD fear, uncertainty, and doubt).
The behavior of crypto users reflects a level of carefulness that suggests many of them would rather stay away from the altcoin market until the cases end. That implies a migration from altcoins to other classes of digital assets, like Bitcoin and stablecoins.
Kaiko’s finding confirms the migration toward Bitcoin. It suggests investors are still willing to invest but in a less risky asset. They may also be paying attention to a developing bull run ahead of the upcoming Bitcoin halving.
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