The actual market share of Bitcoin may exceed 90%, citing the results of Arcane Research. According to CoinMarketCap, the Bitcoin dominance index is currently about 69%.
Analysts of Arcane Research assert that when calculating the index it is necessary to take into account liquidity first of all. "Someone may sell one token for $3, but what happens if you want to sell a million? - they write. - Without taking liquidity into account, market capitalization becomes a meaningless metric.
Arcane Research's research focused on trading volume to recalculate market capitalization of cryptocurrency assets. They assume that more advanced metrics can be used to achieve more accurate results.
However, the methodology described allowed them to get an estimated 90% Bitcoin outperformance over the wider market, which is more than 20% higher than other sources. Stable drugs were excluded from the calculations, as they do not compete with highly volatile cryptocurrencies, according to Arcane Research.
According to the authors of the report, the data obtained confirm the version that the role of alternative cryptocurrencies continues to decline. The network effect leads the money to where liquidity decides, they say.
These data may be of interest not only to investors, but also to developers of payment infrastructure, write Arcane Research, adding: "It is known that it is not easy to compare and contrast projects focused on different niches. In the context of the cryptocurrency, someone may say that the very idea of comparing the relative strength of different coins and tokens is untenable because the solutions in question complement each other.