The share of bitcoin is decreasing.” Why is it important to | NFT / BTC / DEFI News 📣
The share of bitcoin is decreasing.” Why is it important to estimate the $3 trillion market
Experts named the factors by which the assessment of the digital asset market may grow to $4 trillion in the next few months and explained how the increase in this indicator affects the industry
On the morning of November 8, the market valuation of cryptocurrencies exceeded $3 trillion for the first time, according to CoinGecko. This happened after the price of bitcoin to $66 thousand and the update of the historical Ethereum maximum above $4.78 thousand. RBC-Crypto experts explained why achieving a $3 trillion capitalization is an important event for the digital asset industry.
Liquidity is important to whales
The $3 trillion level for crypto market capitalization is an important mark especially for large investors, said Viktor Pershikov, leading analyst at 8848 Invest. In his opinion, liquidity, market depth and safe storage of digital assets are important to “Kitam”.
“Whales” are investors - large holders of digital assets.
“The capitalization of the market above $2 trillion made it possible for large names from the classic stock market to enter cryptocurrency, and classic banks to start offering crypto products,” explained the analyst.
With the growth of capitalization, the trust of participants in the industry also increases, the risks of rapid price drops, which are characteristic of low-capitalized assets and sectors, are reduced, Pershikov explained.
Next goal
If the current pace and dynamics of industry growth continue, the capitalization of the crypto market may reach $4 trillion within the next 2-3 months, predicted Mikhail Karkhalev, financial analyst of the Currency.com crypto exchange. In his opinion, it is worth taking into account not only the possible rise in the price of bitcoin, but also the dynamic development of decentralized finance (DeFi). New promising projects can easily push out already held projects from the top 10 most capitalized cryptocurrencies, the analyst explained.
On the horizon of several years, the capitalization of the digital asset market will increase to $7-9 trillion, Pershikov is sure. He argues that the main reasons for growth will be the arrival of new institutional players and inflation in fiat currencies, which will only increase.
“Taking into account current trends, next year capitalization may increase to $4 trillion against the background of additional capitalization of two sectors: DEX tokens and DeFi projects,” the analyst believes.
What else to pay attention to
It is important to take into account not only the overall level of capitalization of the crypto market, but also its structure, warned Anton Kravchenko, CEO of Xena Financial Systems. He advised to note that the share of bitcoin in the market is decreasing, while other projects are growing rapidly. At the moment, BTC domination is 43%, although in the second half of October it was at 48%, according to Coinmarketcap.
“Hundreds of millions of dollars have been invested in product development at Solana, Algorand, Fantom, new ecosystems are developing,” Kravchenko said.
