Bitcoin dominance is diving to its lowest in years, the Altcoin season is finally here


Bitcoin price was rejected above USD 55,000 and is now on the decline again. Meanwhile, altcoins like Ethereum continue to rise, completely untouched by the leading cryptocurrency by market cap.

The recent divergence between the top dog and the rest of altcoins has caused Bitcoin’s dominance to plunge to levels not seen since 2017 and 2018. Could this be the official start to the altcoin season before the market cycle starts all over again?

BTC dominance is returning to levels not seen since the last crypto bull market

More than 1000 days have passed since the last time the dominance of BTC was below the 50% level, indicating that altcoins had taken over the crypto market.

The past 1000 and several days after that were instead completely dominated by Bitcoin, rising to 73% peak dominance by the end of 2020.

Related reading | Ethereum closes in at $ 2,800 as ETH 2.0 deposit contract reaches new ATH

BTC.D, a metric weighing the highest cryptocurrency’s market cap against the rest of the space, is now back below 50% and could be ready to set new lows if altcoin season really is upon us .

Altcoins conquering much more dominance this time around makes sense, as the coins have easily popped up multiple times since then and each market cap is rising individually.

bitcoin dominance altcoin season

A weekly close below that box starts altcoin season | Source: CRYPTOCAP-BTC.D on TradingView.com

What Altcoin Season Means for Bitcoin, Ethereum, Litecoin and Other Top Coins

If the altcoin season is really here, there are a few things crypto investors can expect based on past cycles. The start of the Altcoin season doesn’t always mean Bitcoin’s run is over.

During the 2017 bull run, there were two different altcoin seasons, only one of which ended the historic crypto market cycle. Altcoins surpassed much after Bitcoin, which is a scenario that could come into play right now.

Related reading | The Rise Of Dogecoin: The Good, Bad, And The Ugly

But with Bitcoin still so bullish, just because the altcoin season is here doesn’t mean the bull run for BTC is over. Instead, altcoin capital could flow back to BTC, driving the top brass crypto assets even higher.

Once the coin peaks before the grand finale cycle peak, another altcoin season can act as exit liquidity before the cycle ends, and it all starts to repeat itself.

The largest and most respected altcoins such as Ethereum and Litecoin would spin first, then money will flow from majors to mid-caps and eventually the risk will venture to small-caps for moonshot-type gains.

The important thing is to get out when it looks like things are about to end as altcoins tend to collapse by as much as 99% when they eventually run out of steam, and the momentum instead goes down.

Featured image from Pixabay, Charts from TradingView.com

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