Bitcoin Dominance Drops as Ether Sees an 8% Surge

Fed Chair Jerome Powell: Bitcoin Competes with Gold, Not the Dollar

During an appearance at The New York Times’ DealBook Summit, Federal Reserve Chair Jerome Powell clarified that Bitcoin should be viewed as competing with gold rather than the U.S. dollar. Powell emphasized that Bitcoin is primarily a speculative asset, akin to gold, and is not yet being used as a stable store of value or a medium of exchange due to its volatility.

While Bitcoin has largely remained stagnant, Ether (ETH) saw a notable 8% surge on Wednesday, pushing its price over $3,880. The rally was partly fueled by the closure of $800 million in short positions, as noted by Tom Dunleavy of Master Global. CoinDesk Senior Analyst James Van Straten also pointed out that Ether is benefiting from a resurgence of capital inflows, which mirrors the market conditions of the 2021 bull market.

Bitcoin’s dominance in the market peaked at 61.85% on November 21, but has since fallen to 54.84%, while Solana’s market share has also seen a decline. “Bitcoin has stayed flat, so Ether is catching up,” Van Straten said, explaining why many altcoins in the CoinDesk 20 Index are performing strongly. Despite Bitcoin’s subdued movement, the CoinDesk 20 Index has risen 1.83%, with Ethereum Classic (ETC), Filecoin (FIL), Polkadot (DOT), and Uniswap (UNI) seeing gains of 22%, 18%, 17%, and 16%, respectively.

Powell also briefly addressed inflation, stating that the Federal Reserve can afford to be cautious in its approach to achieving fiscal neutrality. When asked about Bitcoin’s rise in relation to concerns about the U.S. dollar, Powell reaffirmed that Bitcoin is not a competitor to the dollar but rather a digital version of gold. He reiterated that the Fed’s primary goal in crypto integration is to protect both the banking system’s stability and consumer interests.