In normal market cycles, Bitcoin’s dominance exhibits a specific pattern: when the market remains influenced by sellers (when the market exhibits a bearish nature), Bitcoin’s dominance increases;
When sellers start to challenge buyers in the market (when the market shows early signs of the beginning of a bullish nature), BTC dominance continues the same behavior; finally, when sellers take control of the market (when the market shows a bullish nature), Bitcoin dominance drops drastically. Is the current crypto market cycle following this traditional pattern?
Current market behavior: breaking with tradition?
Potential deviations from this traditional pattern. Why Bitcoin’s dominance shows no signs of abating despite the end of the bear market phase. Historically, we would expect Bitcoin’s dominance to decline as the market recovers. However, Bitcoin’s dominance remains strong, hovering around 54.3% — close to its yearly peak.
Bitcoin Dominance Analysis
As of today, Bitcoin’s dominance is around 54.3% — very close to its highest dominance this year. The highest dominance in the past 12 months was 54.37% — recorded in mid-August 2024. The lowest value in the past 12 months was 46.35% — reported in early September 2023. In mid-January, BTC’s dominance was only 47.6%. In mid-April, it climbed to 51.9%, and in late July it reached 53.2%.
Why is the current cryptocurrency cycle behaving differently? Two possibilities
Two possibilities exist to explain the current deviations from the traditional cryptocurrency market cycle patterns. The first theory is that what we are seeing now is an atypical market cycle – a unique cycle that does not follow the traditional pattern. The second theory is that the market has yet to witness the beginning of a true bull run in which Bitcoin dominance responds. Both theories sound convincing.
No Altcoin season? What crypto investors can expect
Don’t expect Altcoin to dominate the market. Instead, the next phase of the bull run will likely be led by a few major cryptocurrencies. While smaller Altcoin may see some growth, the days of blindly investing in Altcoin are over. Investors should carefully evaluate the potential of their holdings rather than rely on Altcoin to surge.
In conclusion, gone are the days when investors blindly picked Altcoin and invested very little to understand their potential.
In short, even if the market sees the start of an Altcoin season, you can’t expect your crypto to grow your wealth unless what you hold has real potential.
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