Bitcoin (BTC) expanded its dominance metric, after Ethereum (ETH) and smaller coins and tokens showed ongoing weakness. Bitcoin dominance also suggests altcoin season is still delayed.
State of the Bitcoin Market
Bitcoin dominance metrics rose to 58% of the entire crypto market capitalization, based on Tradingview data. BTC is now back to the dominance levels of 2022, after a two-year trend of constant expansion. Coinmarketcap data place the BTC dominance at 56.9%, due to including more altcoins in the calculation. Ethereum (ETH) reduced its dominance to 13.6%, after the ETH/BTC ratio dipped near historical lows. The chief reason is that during the 2024 bull cycle, BTC had more limited drawdowns, while some altcoins never recovered.
Reasons for Bitcoin's Growth
The latest market recovery saw BTC rally to $61,208.67, after spending a day in the $58,000 range. Trading volumes recovered to $28B in 24 hours. However, the Bitcoin fear and greed index sank from 39 points to 33, again in the fear range. BTC also survived the bear market with better gains, as the crashes of 2022 revealed some of the risks of DeFi.
Impact on Altcoins
During previous market cycles, peak BTC dominance signaled a potential rollover into altcoins. But in 2024, the market uncertainty may actually be making most participants flock to the most liquid asset — BTC. Altcoin season may arrive after months of accumulation and when BTC dominance reaches its peak. Currently, BTC continues to dominate despite the presence of a large collection of alternative coins and tokens in the market.
Bitcoin's dominance in 2024 remains strong despite the volatility in the altcoin market. Expectations of a major BTC rally post halving and events such as the US Presidential Elections might further cement Bitcoin's market position.
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