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CryptoIntelligence 2025-02-05 19:36:00

Bitcoin Dominance Hits 71% as Analysts Declare End of ‘Altseason’

The cryptocurrency market has seen a major shift in 2024, with Bitcoin’s dominance surging to 71%, leading analysts to declare the end of the latest altseason. As capital continues to flow into Bitcoin at the expense of alternative cryptocurrencies, many investors are now questioning the future of the altcoin market in the near term. Bitcoin dominance—measuring BTC’s market cap as a percentage of the total crypto market—has steadily climbed, reinforcing its position as the preferred digital asset for investors. The shift has coincided with a broader sell-off in altcoins, many of which have failed to sustain their gains from earlier in the year. Prominent crypto analyst Rekt Capital noted that “altseason is over,” pointing to the sharp decline in altcoin performance relative to Bitcoin. “The market is cycling back into Bitcoin, and historically, when BTC dominance nears these levels, altcoins struggle to gain traction,” the analyst stated. The term “altseason” refers to periods when altcoins significantly outperform Bitcoin, typically driven by speculative enthusiasm and capital rotation. However, this trend often reverses as market conditions shift, leading investors to consolidate their holdings back into Bitcoin, widely considered the safest bet in the crypto space. Historically, Bitcoin dominance has fluctuated depending on investor sentiment and macroeconomic conditions. During the last major altseason in 2021, BTC dominance fell below 40% as Ethereum and other altcoins saw significant gains. However, the current market cycle has seen Bitcoin reclaim a commanding share, reflecting cautious investor behavior amid regulatory uncertainty and shifting liquidity conditions. Ethereum, the largest altcoin by market cap, has also struggled to keep pace with Bitcoin in recent weeks. While ETH remains a key player in the crypto ecosystem, its market share has declined as BTC continues to attract institutional interest, particularly following the approval of Bitcoin spot ETFs in the U.S. earlier this year. The altcoin market, which includes thousands of smaller cryptocurrencies, has experienced increased volatility as Bitcoin continues its upward trajectory. Many smaller projects have faced sharp declines, leading some analysts to warn of a prolonged period of underperformance for altcoins. Rekt Capital also highlighted that while individual altcoins may still see occasional breakouts, the overall trend suggests a prolonged phase of Bitcoin dominance. “Historically, when BTC dominance reaches these levels, it takes a significant shift in market structure to bring back altcoin momentum,” the analyst explained. Bitcoin’s growing dominance is also tied to macroeconomic factors, including inflation concerns, central bank policies, and increased institutional adoption. With the next Bitcoin halving event scheduled for 2024, many investors anticipate continued strength for BTC, potentially extending the altcoin downturn. Despite the current market trend, some traders remain optimistic that altcoins could see a resurgence later in the year if Bitcoin stabilizes and capital begins rotating back into smaller assets. However, for now, Bitcoin’s dominance remains firmly in place, signaling a more challenging environment for altcoin investors.

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