According to the CoinGecko Q3 Crypto Industry Report, the overall market has shrunk by 1.0%. Bitcoin is currently enjoying its highest market dominance in three years, while Ethereum is facing some challenges.
Bitcoin is doing quite well, capturing over 53% of the total crypto market. Right now, its dominance is above 58%. This is the highest it has been since the bull run back in April 2021.
However, not everything is looking up. The total market cap for all cryptocurrencies has dipped slightly during this time. Even Bitcoin has underperformed compared to traditional assets like gold and various treasury bonds. In fact, British, Japanese, and US treasury bonds have all outperformed Bitcoin since early August.
Government policies around the world have played a significant role this quarter. For instance, US interest rate cuts have been beneficial for Bitcoin, and potential tax cuts in Japan have also helped. Additionally, stimulus announcements from China have provided a boost to the entire crypto market. While CoinGecko didn't evaluate Chinese treasury bonds, analyst Eric Balchunas noted strong performance in China ETFs. He said, “YEAR OF THE BULL: China ETFs’ October inflow total is now up to $11 billion. What a chart!”
In short, Bitcoin is gaining an edge in the crypto market, but it’s not a complete victory. The larger market is still struggling, and global economic policies have significantly impacted Bitcoin's success.
The report also mentions that even though Bitcoin's price remained flat in Q3, US Spot Bitcoin ETFs saw larger net inflows compared to Q2. This led to a 13.2% increase in assets under management.
On the other hand, Ethereum is losing ground. Base has been steadily taking away Ethereum’s share in decentralized exchange (DEX) trading. Solana is also making gains, thanks to its technical advantages.
In Q3 2024, Ethereum was still the leading chain for DEX trading, but its market share has now dropped below 40%. DEX trading on Solana has continued to thrive, driven by a surge in meme coins. Meanwhile, Base has kept growing its market share, even during a slow quarter for crypto.
Ultimately, neither Bitcoin nor Ethereum can claim a fully successful quarter. The slight dip in the crypto market during Q3 2024 is concerning. Bitcoin’s performance is closely tied to various external factors, and Ethereum is facing real competition.