There are basically 2 reasons on why this happens, first, the metal cake tin on the outside conducts the heat faster where the sides of the cake set while the centre still continues to bake, hence rising higher than the sides. Second, the usage of stronger flour ie. all-purpose flour creates a strong structured cake where it prevents the leavening gases to escape until towards the end of the baking when they erupt in the centre like a volcano.
To prevent a domed cake, either use lighter coloured baking tins or use weaker flour ie. soft or cake flour. Otherwise, take in this tip which I've learnt from Renee's
Voila, that's it, very easy peasy as any towels (I supposed 100% cotton since I'm not sure if polyester ones will catch fire in the oven or not) will do unless you're a gadget person who would like to own a baking strip! Great to make layered cake else it would be troublesome to cut away the domed part.
The above picture showed the Moist Chocolate Cake that I've baked for my boiboi's Birthday recently. See how flat the cake turned out!!! I've baked 2 cakes then sandwiched them together with the chocolate fudge icing.
The Moist Chocolate Cake on the left was done 100% according to the recipe, hence the icing looked darker where else the right one was the botched one!