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Bitcoin is once again hogging the spotlight after hitting another all-time high of over $120,000 (£88,900). Several factors have contributed to this record-breaking development, including the growing popularity of spot Bitcoin ETFs and increased institutional and corporate adoption.

Surprisingly, despite prices rising to fever-pitch levels, Bitcoin's market share is slipping at a noticeable pace. This is not a fluke but a shift driven by a variety of factors, including increased investment in altcoins and the spiking popularity of ecosystem tokens. Here's an overview of the primary contributing factors:

1. Investment in Altcoins

Most BTC investors look for other assets to invest in after reaping juicy returns following this crypto's new all-time high. The reasons for that are many and varied. For instance, some use their gains to buy altcoins for portfolio diversification purposes. Many seasoned investors, on the other hand, know that after hitting an ATH, Bitcoin's market dominance often declines as people shift their attention to other assets. Finally, some whales exit as soon as BTC hits a new record because they expect the price to dip within a short time.

2. ETH's Increasing Market Share

Ethereum's market share has been increasing steadily over the years. In other words, more people are investing in ETH, and this crypto's price is rising at an incredible pace. Ethereum's market share is now nearly 10%, which is a significant improvement from the 7% recorded in 2024. As more investors adopt this cryptocurrency, Bitcoin's dominance decreases despite its price soaring. You can get the most out of Ethereum, Bitcoin, and other cryptos by learning to maximise your crypto investments with an Australian regulated broker.

3. Increased Speculation

There's always a spike in the number of investors a short while after Bitcoin hits an all-time high. As soon as this crypto shatters a new record, it makes headlines on everything from social media to newspapers and TV. The massive exposure attracts the attention of people who have yet to invest in digital assets. That and stories about individual investors making fortunes overnight from Bitcoin. The newbies enter the crypto space and invest in what they hope will be "the next Bitcoin." That causes increased focus on low-cap altcoins and erodes BTC's dominance.

4. Growth of Ecosystem Tokens

Unlike Bitcoin, which is primarily digital money for investors and consumers, ecosystem tokens are assets that fuel entire decentralised economies. They are deeply connected to their respective ecosystems and serve critical purposes, such as paying gas fees, providing incentives to investors, and offering staking rewards. Common examples include Ethereum, Solana, and Polygon. Despite BTC being at an ATH, ecosystem tokens are still getting a lot of attention and reducing BTC's market share because they are associated with more functionality and growth potential.

Final Thoughts

Bitcoin recently reached an all-time high, but its market share is shrinking. So, if you're holding Bitcoin, consider locking in profits and shifting to high-potential altcoins like Ethereum. If you just noticed BTC's ATH but are new to crypto investing, don't buy now. The prices might dip at any time, leading to losses. Find reputable low-cap assets and buy them. Then be patient and wait for their value to increase.