Over the weekend, while the stock market remained closed and thus unable to react to the news of an Iranian drone attack targeting Israel, the crypto market swiftly responded.
Across the board, assets experienced a downturn as traders adjusted their portfolios and reduced risky positions. Bitcoin, for instance, saw a significant drop from its Friday high of over $70,000 to just above $63,000 by the end of April 13, marking an approximately 11.6% decline.
Interestingly, Bitcoin emerged as one of the least affected cryptocurrencies. According to Coinglass, centralized exchanges witnessed over $757 million in long liquidations on Saturday, with only $261 million attributed to bitcoin positions.
While most crypto assets are generally considered risky by traders, bitcoin stands out as arguably the least risky due to its substantial market capitalization and a track record of institutional adoption. Conversely, speculative assets like Dogecoin experienced a nearly 30% decline from Friday’s peak to Saturday’s low.
Towards the end of Saturday, many assets seemed to stabilize, showing a slight rebound.
In theory, bitcoin had the potential to surge in such a situation, given its status as a “safe haven” asset, not tied to any particular government or country. Similar to gold’s recent performance amid Middle East tensions, bitcoin, often dubbed “digital gold,” could have benefited. However, with the stock market closed, cryptocurrencies bore the brunt of the downturn.
Despite the setback, bitcoin still maintained its position as a top performer. Its dominance, representing its market cap share relative to the total cryptocurrency market cap, surged to 52.86% on Sunday, the highest since April 2021.
This reversal contrasts with February’s scenario when altcoins surged, pushing bitcoin’s dominance to its lowest level since March 2023. However, the weekend’s relatively subdued market activity allowed bitcoin to reclaim its most significant market share in three years.
