Crypto traders seek shelter in bitcoin as altcoins slide and ETF flows wobble

Bitcoin’s BTC$84,459.46 share of the crypto market has climbed to the highest level since May, even as prices across the wider market weaken.

The cryptocurrency’s dominance rate, its contribution to the total market value of digital assets, reached 60% on Wednesday and remains near that level. The move signals a renewed preference for BTC, with investors favoring the largest cryptocurrency over alternative coins.

The rise in dominance comes amid muted price action. Bitcoin slipped below $82,000 on Thursday, reversing Wednesday’s brief push above $84,000. On a seven-day basis, BTC and most other major tokens — including ether ETH$2,490.55, XRP (XRP) and solana (SOL) — were largely little changed to positive, with zcash (ZEC) the only major coin to advance more than 10%.

Smaller tokens, however, have seen bigger declines. The CoinDesk Memecoin Index fell more than 5%, while the CoinDesk Computing Select Index dropped 3.5% and the DeFi Select Index lost 2.5%.

Analysts say the market is awaiting a fresh catalyst.

“The earlier period of crypto outperformance has given way to closer alignment with equities as investors wait for a fresh catalyst within the sector,” Joel Kruger, a market strategist at LMAX Group said in an email.

Kruger added that global macroeconomic situation remains the dominant influence, and bitcoin’s scarcity could help it sustain potential jitters in global equity markets.

Vikram Subburaj, CEO of India-based Giottus exchange, cautioned against chasing bitcoin rallies, pointing out that exchange-traded funds (ETFs) still lack a consistent bid.

“Flows remain volatile, and sustained inflows are needed to confirm a stronger recovery,” he said in an email. “Our advice: Investors should avoid chasing short-term rallies. Consider staggered entries, maintain measured position sizes and monitor ETF flows and Fed signals before increasing exposure.”

The Federal Reserve is set to meet on interest-rate policy next week. Stay alert!

What’s trending

• Asian stocks tumble, bitcoin retreats as China enters bear market (CoinDesk): Equities slumped as technology shares sank and rising oil prices compounded investor concerns.
• China seeks to seize 61,800 BTC tied to $5.7 billion fraud scheme (CoinDesk): Chinese prosecutors moved to seize more than 61,800 bitcoin linked to a fraud case worth roughly $5.7 billion, days after a U.K. court ruled Chinese law governs victims’ claims to the coins.
• Yen set for biggest rally in a month; risk-averse investors shun dollar (Reuters): The yen headed for its strongest daily rally in a month, drawing ​safe-haven flows from investors fretting over fragile equity markets, high crude prices, war in the Middle East and potential disappointment in future ‌returns from AI.
• World’s largest wealth fund posts $30 billion loss after bond market turbulence (CNBC): Norway’s sovereign wealth fund said its investment portfolio lost $30 billion in the third quarter as rising interest rates dented returns on its bond holdings. The period saw a global bond market rout as major central banks began raising interest rates and concerns about inflation and government debt mounted.

Today’s signal

The chart shows XRP’s daily price swings since May. Overlaid on the chart is the Ichimoku cloud, an indicator used to identify support, resistance and momentum.

XRP is currently trading below the cloud, a sign of bearish momentum building. Crossovers above and below the cloud are said to represent bullish and bearish trend reversals.

The graphic indicates that if prices hold below the cloud, further losses may follow.