Bitcoin Dominance Aims At Historic Lows, Unprecedented Altcoin Season Potentially Ahead
05 January 2022 - 6:39AM
NEWSBTC
While Bitcoin continues to take a beating in terms of dollars, the
top cryptocurrency also continues to lose its share over the market
cap. In fact, with the most recent support level breached, BTC
dominance could be targeting historic lows. Historic lows in BTC
dominance could mean that an altcoin season unlike ever before is
potentially ahead. Here’s a closer look at the metric that weighs
Bitcoin against the rest of the crypto space and how it could
impact altcoin performance. Bitcoin Continues To Lose
Cryptocurrency Market Dominance At one point, there was only
Bitcoin. As the industry grew, a metric was born called BTC
dominance that made it more clear how much weight the top coin had
compared to the rest of the market. Prior to 2017, Bitcoin
accounted for as much as 95% of the entire cryptocurrency market,
but fell to a low of 35% less than a year later during what is
considered to be the greatest altcoin season on record. Related
Reading | 2022: The Year The Secular Bitcoin Bull Run Could End
After reaching such extremes in 2018, by 2020, Bitcoin had
recovered more than two-thirds of the market cap. Dominance topped
out near 70% where it sharply reversed all throughout 2021. At the
close of the 2021 yearly candle, a several year trading range was
officially breached. The well defined range is even more visible in
the six-month BTC.D chart. And it could create the conditions
necessary for an unprecedented altcoin season. The yearly (left)
and six-month (right) BTC.D chart | Source: CRYPTOCAP-BTC.D on
TradingView.com Unprecedented Altcoin Season Could End At 32%
Dominance With a decisive close on high timeframes, lower timeframe
patterns could provide clues as to where dominance might bottom out
once again. Related Reading | Bitcoin Falls Flat: Examining A Rare
Bull Market Corrective Pattern The target of a head and shoulders
top sent BTC.D to the dashed line, reinvigorating altcoins but
still falling short of the mania seen during the 2017/2018 peak. A
descending triangle could target 32% dominance | Source:
CRYPTOCAP-BTC.D on TradingView.com With a potential descending
triangle breaking down, the measure rule would make the target of
the structure around 32% dominance. The target would suggest a move
beyond the former historic low set years ago – and create the
atmosphere needed for the aforementioned altcoin season mania. But
it all could come at the expense of Bitcoin and its undisputed
reign as the number one cryptocurrency by market cap. Follow
@TonySpilotroBTC on Twitter or join the TonyTradesBTC Telegram
for exclusive daily market insights and technical analysis
education. Please note: Content is educational and should not
be considered investment advice. Featured image from
iStockPhoto, Charts from TradingView.com
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