Bitcoin stole the show when it came to crypto for months, sucking capital out of the altcoin market. Shortly after the top cryptocurrency began its retreat, profits flowed back into altcoins, which have risen sharply since last month.
The BTC dominance shows how the battle between Bitcoin and Altcoins was brought to the point. There is only one line left that separates a sustained surge into full-blown alt-season or the top cryptocurrency approaching total dominance.
BTC dominance is two thirds of the market share
Once upon a time there was only one thing: Bitcoin. Satoshi Nakamoto’s vision of a better form of digital money has grown into a vast digital universe full of altcoins that serve various purposes.
Cryptocurrencies are no longer just currencies. They’re the building blocks of decentralized funding, a way to keep transactions private, and much more.
Bitcoin itself is still viewed as an experiment, but this stigma is disappearing day by day as institutions buy into the scarce resource as a safe haven. Altcoins, without some with today’s use, are still far more speculative, illiquid, volatile and risky.
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When Bitcoin and Altcoins became public in 2017, the longevity and acceptance of the first cryptocurrency helped weather the top crypto winter by far better. From top to bottom it fell 84%, but altcoins fell a lot further by comparison.
When this all happened, Bitcoin was no longer the only kid on the block, it only made up 35% of the total market share. But since then, altcoins have been in a downtrend versus Bitcoin, reaching a crucial moment. And everything rests on just one line.
BTC.D is resting on a clearly important line | Source: CRYPTOCAP-BTC.D on TradingView.com
What’s next? Altcoin Season or Total Bitcoin Dominance?
Intraday price actions are important, but the higher the time frame, the more dominant the signals on a chart. Even BTC.D, a measure of Bitcoin’s dominance over all other altcoins, behaves this way.
BTC.D currently rests on almost exactly two-thirds of the dominance. The line in the monthly timeframe shows why the level is so important.
Related reading | Altcoin Expert: Buy A Crypto That Will Last During Bitcoin Crash
The zone first acted as a resistance after Bitcoin hit the cap in 2017 and again in 2019. The support could not hold, but the dominance broke back and is now testing the clearly critical line again as support.
If dominance continues, we could soon see a future for overall Bitcoin dominance reaching levels of 80% or more. If the support fails, another, more profitable altcoin season is the likely outcome.
Regardless of the chosen direction, the market share of cryptocurrencies will change dramatically for the foreseeable future.
Featured image from Deposit Photos, Charts from TradingView.com