The total market capitalization of the cryptocurrency – an important thermometer for the overall health of the digital asset class – reached $ 1 trillion for the first time at 19:00 ET on Tuesday, January 6. Bitcoin briefly hit $ 37,000 at the same time, setting a new record.
Measured by market capitalization, the crypto asset class nearly doubled last month, when Bitcoin (BTC) hit new highs and Ether (ETH) cleared $ 1,100 for the first time in three years. Combined, the two assets account for about two-thirds of the overall market.
The gravitational pull of BTC and Ether on the market saw dozens, if not hundreds, of cryptocurrencies, reporting double-digit percentage returns last week.
The capitalization of a trillion dollars was reached just days after the market surpassed the 2017-18 bull market highs. During the last peak of the cycle in early 2018, the combined market capitalization reached about $ 830 billion, according to CoinMarketCap.
At the time, altcoins peaked at close to $ 547 billion after Bitcoin retreated from its December 2017 peak. The altcoin market is currently worth less than half of that total, highlighting the absolute dominance of Bitcoin so far in the current cycle.
Typically, Bitcoin bullish cycles pave the way for a subsequent rise in altcoin, which is generally greater than the BTC initial markup. Called ‘altseason’ by the cryptographic community, the parabolic rise in altcoins can happen quickly, leaving investors with little time to prepare.
Many crypto watchers are predicting a 2021 high for Bitcoin and altcoins. They cite the growing institutional demand for BTC, the ubiquity of cryptography on ramps and the natural ebb and flow of four-year market cycles to their optimism.