Why Bitcoin’s Dominance is Rising in the Crypto Market
Bitcoin (BTC) has been the dominant cryptocurrency in the market for a while now. The impending halving and risk aversion in the broader market have contributed to this rise in dominance. According to CoinDesk Indices data, BTC was trading below $61,400 during Asian hours on Thursday. This price drop is a result of the sell-off in risk assets, driven by difficult macroeconomic conditions. The recent volatility in the market has affected not only BTC, but also layer-1 blockchains and altcoins, with some top tokens experiencing significant losses. For instance, Solana’s (SOL) value has decreased by over 20% in the past week, while Avalanche’s (AVAX), Cardano’s (ADA), and Filecoin’s (FIL) values have all seen a decline of over 20%.
Binance’s Potential Re-Entry Into India
In related news, it was reported that Binance, the cryptocurrency exchange that was previously removed from India, may be looking to re-enter the country by paying a $2 million fine. Earlier this year, Binance and other exchanges were removed from the Apple Store in India after receiving compliance “show cause” notices from India’s Financial Intelligence Unit (FIU). Other exchanges that were sent notices include OKX, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex.
USDe Holders Should Monitor Project’s Reserve Fund
CryptoQuant, a data provider, has advised USDe holders to closely monitor the project’s reserve fund to mitigate any risks related to a potential negative funding rate. The stablecoin’s yield is currently at 17.2%, a rolling average over the past seven days, for investors who stake USDe or other stablecoins on the platform. This yield is generated through a tokenized “cash and carry” trade, where the asset is purchased and simultaneously shorted to earn funding payments. These funding payments help keep asset prices on derivatives exchanges in line with the underlying assets. In a bullish market, holders of long positions pay short positions, and vice versa in a bearish market.
In Conclusion
Despite recent market volatility, Bitcoin’s dominance in the cryptocurrency market continues to rise. The impending halving and risk aversion have contributed to BTC’s market dominance, and it remains to be seen how the market will react in the coming weeks. With the potential re-entry of Binance into India and the need for USDe holders to monitor the project’s reserve fund, the crypto market is once again experiencing significant shifts that could have a significant impact on its overall performance.