At over $140 billion, the altcoin market capitalization has broken multi-year resistance levels. This should come as no surprise when looking at the truly monumental gains that many altcoins have enjoyed over the past few months.
Developments surrounding Ethereum (ETH) 2.0 and the budding decentralized finance (DeFi) industry are helping to push altcoin valuations even higher. As a result, Bitcoin has seen its market cap dominance declining slightly in the past quarter.
Altcoin Market Capitalization Takes Off
In mid-June 2019, the total altcoin valuation failed to cross $139 billion despite weeks of price gains that began in the months leading up to it.
The total altcoin market cap first breached the $140 billion level back in November 2017. At the time, the market was in a speculation-driven bull run that saw the figure top out at about $541 billion in early 2018.
At the current valuation, the altcoin market cap is still over 73% down from its January 2018 all-time high. The year-long bear market of 2018 caused altcoin prices to decline by an average of almost 90%.
With the resistance range between $140 billion to $180 billion, any move above the latter will likely signal a sustained bullish advance for altcoins. For now, the current spike might be a deviation followed by a swift retrace dampening hopes for a new altseason.
DeFi Dominating 2020 Crypto Scene
Multiple pieces of evidence for this rise in DeFi prominence exist across the virtual currency space with the total value locked (TVL) in DeFi projects growing from $680 million to $4.69 billion year-to-date.
Chainlink (LINK) is now a top-10 cryptocurrency with its price growing over 600% YTD. The project is the most popular oracle utilized by DeFi projects, translating data between off-chain sources, and on-chain smart contract protocols. As previously reported by BeInCrypto, LINK trading volume recently surpassed Bitcoin (BTC) on Coinbase.
Yield farming on projects like Compound (COMP), Balancer (BAL), and yEarn.finance (YFI) also continue to attract interest. Some market analysts, however, state that the speculative yield chasing craze poses risks to the emerging DeFi space.
The move to full proof-of-stake (PoS) implementation is also driving activity towards Ethereum and Cardano (ADA). Investors are eyeing the possibility of earning significant rewards from staking their crypto holdings on forthcoming PoS chains.