ALT Season Ahead
Hey,
I wanted to share some thoughts on the current market dynamics and what I’m observing in BTC dominance.
If you’re invested in ALT coins—especially legacy coins like ETH, XRP, or even RUNE—you might feel like your returns are lagging significantly. The truth is, they are. Let me break down the relationship between ALTs and BTC dominance to give you some context.
I use TOTAL3 and BTC dominace charts, check them out.
There’s a strong inverse correlation between BTC Dominance and TOTAL3. Historically, when BTC Dominance trends downward, ALTs begin to outperform, experiencing substantial growth relative to BTC. This shift often marks the period when ALT coins start “shining.”
Interestingly, during the last cycle, BTC didn’t peak at the height of BTC Dominance. Instead, BTC peaked after ALTs had a massive rally, during a period when BTC Dominance ranged in the 40-50% zone.
Currently, BTC Dominance remains in a strong uptrend with no clear signs of slowing. For this reason, before heavily shifting into ALTs or taking profits on BTC longs, I’m waiting for a momentum shift in BTC Dominance. Even a simple trendline break to the downside could signal that capital is flowing out of BTC and into ALTs. This doesn’t necessarily mean BTC will lose value; in fact, it might continue climbing. However, it does indicate a tipping point where ALTs could begin to significantly outpace BTC, offering much greater upside potential.
That said, it’s important to consider the growing institutional interest in BTC. Unlike retail investors, institutions are less likely to pivot into ALTs (except for ETH, which benefits from its status as a leading crypto ETF). As a result, BTC Dominance could climb past 70% and may not see a sharp decline even when ALT coin momentum begins.
I wanted to share some thoughts on the current market dynamics and what I’m observing in BTC dominance.
If you’re invested in ALT coins—especially legacy coins like ETH, XRP, or even RUNE—you might feel like your returns are lagging significantly. The truth is, they are. Let me break down the relationship between ALTs and BTC dominance to give you some context.
I use TOTAL3 and BTC dominace charts, check them out.
There’s a strong inverse correlation between BTC Dominance and TOTAL3. Historically, when BTC Dominance trends downward, ALTs begin to outperform, experiencing substantial growth relative to BTC. This shift often marks the period when ALT coins start “shining.”
Interestingly, during the last cycle, BTC didn’t peak at the height of BTC Dominance. Instead, BTC peaked after ALTs had a massive rally, during a period when BTC Dominance ranged in the 40-50% zone.
Currently, BTC Dominance remains in a strong uptrend with no clear signs of slowing. For this reason, before heavily shifting into ALTs or taking profits on BTC longs, I’m waiting for a momentum shift in BTC Dominance. Even a simple trendline break to the downside could signal that capital is flowing out of BTC and into ALTs. This doesn’t necessarily mean BTC will lose value; in fact, it might continue climbing. However, it does indicate a tipping point where ALTs could begin to significantly outpace BTC, offering much greater upside potential.
That said, it’s important to consider the growing institutional interest in BTC. Unlike retail investors, institutions are less likely to pivot into ALTs (except for ETH, which benefits from its status as a leading crypto ETF). As a result, BTC Dominance could climb past 70% and may not see a sharp decline even when ALT coin momentum begins.
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