Bitcoin market dominance has been on the rise, reaching 51.2% on Tuesday and approaching a 26-month high of 52% that was seen at the end of June. This increase in dominance is due to the largest cryptocurrency’s impressive performance this year, with a 66% gain year to date. In comparison, the second largest cryptocurrency, ether, has only gained 32% during the same period.
Factors contributing to ether’s underperformance
LMAX Digital attributes ether’s underperformance against bitcoin to the recent increase in its supply over the past month. The decrease in transaction activity on the Ethereum network has led to less ether being burned, which in turn has increased the overall supply. This increase in supply has contributed to ether’s underperformance in comparison to bitcoin.
Bitstamp to assist European banks in offering crypto services
In other cryptocurrency news, Bitstamp, the oldest cryptocurrency exchange, is reportedly in talks to help three major European banks offer crypto services around the first quarter of next year. This development suggests that the European Union’s significant crypto regulatory effort, known as Markets in Crypto Assets (MiCA), is paving the way for traditional financial firms to enter the digital asset space.
This situation contrasts with the United States, where regulators are tightening their grip on the cryptocurrency industry. The increased regulatory scrutiny in the U.S. has made traditional financial institutions hesitant to get involved with digital assets and has even forced some cryptocurrency companies to consider relocating to more crypto-friendly jurisdictions.
Legal battle involving FTX co-founder
In legal news, lawyers for Sam Bankman-Fried, the CEO of FTX, are seeking to question FTX co-founder Gary Wang about his reliance on legal advice when agreeing to a series of loans from linked hedge fund Alameda Research. The letter from Bankman-Fried’s legal team requests carve-outs from a judge who has previously been reluctant to let the crypto tycoon blame the alleged fraud on his lawyers. Prosecutors have already questioned Wang about the loan he received from Alameda, which he used to make venture investments and purchase a house in the Bahamas.
Conclusion
The recent increase in Bitcoin market dominance highlights the strength of the largest cryptocurrency in comparison to its competitors, particularly ether. While ether’s underperformance can be attributed to its increased supply, Bitcoin continues to gain traction in the market, solidifying its position as the leading digital asset.
The involvement of Bitstamp in assisting European banks to offer crypto services indicates a positive shift in the European Union’s approach to cryptocurrency regulation. This development could potentially lead to increased adoption of digital assets by traditional financial institutions in Europe, while the United States struggles with regulatory challenges.
The legal battle involving FTX’s co-founder serves as a reminder of the complexities and challenges faced by the cryptocurrency industry, particularly in relation to the legal and regulatory landscape. As Bitcoin market dominance continues to grow, it is crucial for the industry to navigate these challenges effectively to ensure the continued growth and adoption of digital assets.
