Bitcoin’s dominance over the cryptocurrency market surged to its highest level in nearly three years as altcoins weakened amid geopolitical tensions and a strengthening U.S. dollar. Bitcoin (BTC) remained above the key $60,000 support level on Thursday, trading around $61,150, up 1% over the past 24 hours. This comes after a brief dip below $60,000 during the previous day’s trading.
Despite Bitcoin’s resilience, the broader crypto market struggled. Ethereum’s ether (ETH) was down 1%, while notable losses were recorded in altcoins like Ripple (XRP), Solana (SOL), Avalanche (AVAX), and Render (RNDR).
However, Aptos (APT), a layer-1 blockchain, was a standout performer, gaining 7% on the day. The surge followed news of Franklin Templeton expanding its tokenized money market fund to Aptos’ blockchain. Analysts speculated that traders may have shifted profits from Sui (SUI), which saw a 110% rally over the past month.
Bitcoin’s outperformance increased its share of the total crypto market capitalization, pushing Bitcoin Dominance to above 58%, its highest level in years. Meanwhile, the ETH/BTC ratio dropped to 0.038, nearing its lowest level since mid-September.
“Bitcoin dominance continues to trend higher, and it is now just 0.2% away from a new three-year high,” said James Van Straten, senior analyst at CoinDesk.
U.S. Dollar Surge Adds Pressure
The weakness in altcoins coincided with a strengthening U.S. dollar, driven by concerns over escalating military tensions in the Middle East and rising crude oil prices, which hit their highest level in over a month at $74 per barrel. The U.S. dollar index (DXY) surged to its strongest level since mid-August following a stronger-than-expected ISM non-manufacturing report, which fueled expectations of further monetary tightening.
Van Straten noted that recent solid U.S. services data pushed the DXY closer to 102, increasing the likelihood of a 25-basis-point rate cut at the upcoming November Federal Reserve meeting.
Additionally, concerns over liquidity stress in key financial markets emerged as the Secured Overnight Financing Rate (SOFR) spiked, drawing comparisons to the repo crisis of September 2019. Steno Research’s Samuel Shiffman cautioned that the Fed might intervene by injecting liquidity into the system if the situation worsens.
Looking ahead, market participants are eyeing Friday’s U.S. jobs report, which could impact risk assets like cryptocurrencies. “A combination of expected rate cuts and labor strength could boost risk assets,” noted crypto hedge fund QCP Capital.
As market volatility continues, Bitcoin’s dominance highlights its status as a safe haven, while smaller cryptocurrencies remain vulnerable to external pressures.
