2024-10-21 23:00 |
Bitcoin and many other cryptocurrencies have been on significant price increases in the past few weeks. Bitcoin, in particular, has been inching close to its all-time high, and the recent break above $68,000 puts it only 8% away from setting a new price record.
Interestingly, this inflow into Bitcoin has seen the cryptocurrency increase its dominance over altcoins. According to data, Bitcoin’s market dominance is now 65% of the total market cap, the highest in three years. This raises the question of whether the altcoin season will still materialize in the current market cycle.
Bitcoin Leaves Ethereum And Other Altcoins In The DustAccording to data from IntoTheBlock, Bitcoin recently reached a market dominance of 65%, which is the highest recorded for the metric during the 2021 bull rally. During that period, Bitcoin captured the lion’s share of investments before eventually ceding some of its dominance to Ethereum and other altcoins in the middle of 2021.
Interestingly, the crypto landscape has changed substantially since then, and Bitcoin has now found a footing among institutional investors. As such, the recent inflows into Bitcoin and its dominance can be attributed to the inflows from Spot Bitcoin ETFs.
According to flow data from SoSoValue, Bitcoin-based spot ETFs in the United States experienced a remarkable performance last week. These ETFs saw consistent inflows every day, culminating in a net inflow of $2.13 billion, its highest since the third week of March.
This is good news for fervent Bitcoin investors and proponents but not for investors betting on Ethereum’s overperformance. One such investor is crypto millionaire James Fickel, who has lost substantial amounts over $43 million, due to his high-risk bet that Ethereum would outperform Bitcoin in 2024.
Altcoin Season To Materialize In Six MonthsAs Bitcoin continues to consolidate its dominance, the potential for a new altcoin season is becoming increasingly uncertain. Current data from the Altcoin Season Index shows a reading of 31, significantly below the threshold of 75, which typically indicates the onset of an altcoin season.
Despite this cautious outlook, crypto analyst Ash Crypto offers a more optimistic perspective for an altcoin season. According to him, the altcoin season is going to kick off in the next six months. In a recent social media post shared with his 1.2 million followers on X, Ash Crypto predicted that Bitcoin will continue its dominance in the short term, potentially rallying toward previously uncharted price levels between $80,000 and $90,000 within the next 30 days.
Drawing from insights gained during the previous market cycle, Ash Crypto pointed out that the altcoins market outperformed Bitcoin for about five months in 2021, just after the Bitcoin dominance reached an all-time high.
At the time of writing, Bitcoin is trading at $68,400.
Featured image from Experian, chart from TradingView
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