Photo = Getty Images Bank.[코인노트] Last year, the growth of the cryptocurrency market was led by ‘altcoins’, meaning coins other than bitcoin. Fields using virtual currency application technologies such as Non-Fungible Token (NFT) and DeFi (Decentralized Finance) drew particular attention.
As of the 30th, Bitcoin traded at about $47,000, recording an increase of just over 60% for the year. Ethereum, the second-largest cryptocurrency by market capitalization, rose more than 400% during the same period, narrowing the gap with Bitcoin, the No. Compared to Bitcoin, Ethereum, which has been used as a blockchain platform in various fields, seems to have received more choices from investors.
The growth of altcoins other than Ethereum was also evident. Cryptocurrencies that provide similar functions in fields where Ethereum is used, such as the DeFi service, recorded a large increase and significantly increased their market capitalization. Ada, which has been attracting attention as an alternative to Ethereum, rose in price by more than 600%, and Solana also showed a surge of more than 10,000% for a similar reason.
Binance Coin, created by Binance, the world’s largest cryptocurrency exchange, has risen more than 1300% in price over the past year, entering the third place by market capitalization. Binance Coin is used for payment of transaction fees on the Binance Exchange, and serves as a currency on its own blockchain (Binance Smart Chain). Experts analyze that Binance Smart Chain also attracted attention as a competitor of the Ethereum platform, which led to the high price increase.
Experts say that the steady rise in the price of Bitcoin has stimulated the growth of altcoins. Arcane Research, a research firm specializing in cryptocurrencies, analyzed that “while Bitcoin was bullish in 2021, investment funds continued to flow into altcoins.”
Bitcoin’s market share fell below 40% for the first time since 2018, as other cryptocurrencies quickly increased their prices compared to Bitcoin.
According to TradingView, a cryptocurrency market analysis service, Bitcoin’s market share has fallen below 40% since the 20th. It is the lowest level in about four years since January 2018. This figure fluctuates slightly around 40%.
Bitcoin’s market share was well over 60% at the beginning of 2021. According to CoinGecko, a cryptocurrency data company, it reached 68% as of January 1, 2021. However, on December 20, it fell sharply to the level of 38.5%. During this period, Ethereum’s market share, which recorded a higher rate of price increase than Bitcoin, rose from 11% to 20%.
US financial analyst Peter Schiff tweeted on the 28th (local time) that “Bitcoin has fallen below 40% market share in four years.” There is,” he said.
Experts are divided on whether the altcoin strength will continue this year. This is because some are predicting a bullish reversal of Bitcoin, while others are predicting a continued bullishness of altcoins. The most cited reason for the prospect of increasing the proportion of Bitcoin is that the investment stability of Bitcoin is higher than that of altcoins. In fact, institutional investors who are new to the cryptocurrency market still prefer to invest in Bitcoin the most.
On the other hand, there is a forecast that institutional investors will start investing in altcoins this year. Noel Acheson, head of Genesis Global Trading Insights, said in an interview with CNBC at the end of last year, “Financial institutions can start investing in altcoins from 2022. They will also be interested in investing,” he said.
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