Bitcoin Dominance Hits 4-Year High, Altcoins May Rise
Key Takeaways
- Bitcoin dominance (BTC.D) reaches a four-year high at over 62%.
- Technical indicators point to a potential trend reversal in favour of altcoins.
- Altcoins are holding at a critical support level of around USD 900 billion.
- Macroeconomic uncertainties could favour a capital rotation into undervalued altcoins.
- Analysts see parallels to previous altcoin seasons, particularly in 2021.
Bitcoin Dominates – But for How Much Longer?
Bitcoin dominance currently sits at approximately 62.4%. This means that over 60% of the total market capitalization in the crypto market is attributed to Bitcoin. These levels were last seen in 2021 – just before a major altcoin rally began.
A look at the RSI (Relative Strength Index), a technical indicator, shows that Bitcoin is nearing overbought territory. This suggests a potential correction. If this trend continues, capital may flow out of Bitcoin and into altcoins.
Altcoins Under Scrutiny
Despite recent weakness in major altcoins like Ethereum (ETH) and Solana (SOL), both of which have lost key support levels, there are signs of a potential trend reversal. The total market capitalization of altcoins is currently below USD 1 trillion. A critical support level of around USD 900 billion is still holding.
Many altcoins are currently trading 80–90% below their all-time highs. This presents opportunities for investors betting on a recovery. Historically, periods of high Bitcoin dominance have often been followed by strong altcoin seasons – as seen in 2021, when BTC.D dropped from over 60% to under 40%.
Macroeconomic Factors as a Catalyst
The current economic environment is reminiscent of previous periods of strong market movement: high inflation, geopolitical uncertainties, and shifts in monetary policy. Such conditions often favour capital shifts within the crypto market.
If Bitcoin enters a sideways trend – which many analysts currently expect – altcoins could have room to recover. Mid-cap altcoins, in particular, may benefit from a rotation, as they are currently under significant pressure.
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Three Possible Bitcoin Scenarios
Analysts are currently discussing three potential price paths for Bitcoin:
- A slow decline to USD 50,000–60,000.
- An extended sideways phase between USD 70,000–90,000.
- A breakout above USD 90,000 – currently unlikely without new momentum.
The most likely scenario is a sideways movement. In this case, altcoins could gain ground, especially if market sentiment improves and investors become more risk-tolerant.
Our Assessment
Current data points to a potential upcoming altcoin season – provided Bitcoin dominance begins to decline. Technical indicators and historical patterns suggest a possible capital rotation. Investors looking for favourable entry points may find promising opportunities in selected altcoins in the coming weeks.
Keep an eye on Bitcoin dominance. It is a key indicator of market movements. Should it fall below 60%, it could mark the beginning of a new altcoin rally. Strategic risk management and diversification remain essential.
Sources
- TradingView
- CoinGecko
| Symbol | BTC |
| Coin type | Alt Coin |
| Transaction Speed | Slow |
| Pros |
|
| Cons |
|
| Further practical applications | |
| Price | $84,248.00 |
| 24h % | 1.31 % |
| 7d % | -3.53 % |
| 30d % | -9.44 % |
| 60d % | -17.64 % |
| 1y % | 26.36 % |
| Market Cap | $1,671,827,433,903.00 |
| Max. Supply | 21,000,000.00 |
| Official Links | Website | Whitepaper | Source Code |
| Socials | Reddit | X | Message Board |
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