Bitcoin's market dominance has surged to 62%, the highest since February 2021, raising questions about the future of altcoins.
Bitcoin's Dominance Growth
Bitcoin's dominance has reached 62%, contradicting expectations of an altcoin season when alternative cryptos show stronger growth. The Altcoin Season Index, which tracks the performance of the top 50 altcoins against Bitcoin, is at 18. A reading below 25 indicates a 'Bitcoin season,' meaning altcoins are faltering compared to Bitcoin.
Reasons for the Absence of Altcoin Season
During altcoin season, investors shift profits from Bitcoin to smaller markets like Ethereum (ETH) and Solana (SOL) to achieve higher returns, yet recent expectations have not been met. Even after the U.S. Securities and Exchange Commission approved spot Ethereum ETFs, allowing ETH to be traded through traditional brokerage accounts, its price hasn't surged. Similarly, despite Solana's advantages of lower transaction costs and faster processing, it hasn't led to a significant SOL price increase.
Altcoin Prospects
Amid inflation, interest rate decisions, and increased Bitcoin ETF trading volumes, Bitcoin continues to lead. However, projects like Fetch.ai and Render Network, focusing on AI, Web3, and decentralized applications, might benefit once Bitcoin stabilizes. Ethereum's expected upgrade could also revive interest in its ecosystem, potentially spawning a new altcoin season. For now, Bitcoin controls the market, guiding the fate of other ecosystems.
Bitcoin continues to lead in the cryptocurrency market while altcoins await their time to rise. While Bitcoin's dominance may persist for a while, altcoins retain the potential to gain as the leading cryptocurrency stabilizes.
