For over a year, crypto-asset markets have been devoid of a sustained “altcoin season,” but a significant drop in Bitcoin dominance and economic pressure on miners may change that. For those unfamiliar, Bitcoin dominance refers to the percentage of total cryptocurrency market capitalization represented by Bitcoin.
The Bitcoin Dominance Index is calculated by dividing the total market cap of all cryptocurrencies by the market cap of Bitcoin. Recently, BTC’s dominance has fallen to 41.73%, and this drop is because new altcoins are being created that are not simply Bitcoin clones.
On the other hand, only 25 of the top 50 cryptocurrencies by market capitalization have beaten Bitcoin (BTC) in the last 90 days, indicating that we’re not very far from the much-touted “altcoin season.”
Bitcoin Dominance Drops to 41.73%
The Bitcoin Dominance Index chart, which displays how large a slice of Bitcoin’s overall worth (market capitalization) is relative to the rest of the crypto market, is the best method to identify an altcoin season. For instance, assume the Bitcoin Dominance Index is 41.73%. This indicates that Bitcoin accounts for41.73% of the total market capitalization of all cryptocurrencies.
When the index rises, Bitcoin gains ground relative to all the other coins’ market share. A decrease in the index implies the inverse. At the same time, an altcoin season is defined as a sudden, continuous decline in Bitcoin’s dominance over weeks or months.
So looking at the current situation, the world’s leading cryptocurrency, Bitcoin, has dropped 74.5% from its all-time high of $69,119 to $17,573. Despite a 4% recovery, Bitcoin is still trading near a multi-month low of $23,234. As a result, BTC dominance has declined dramatically, falling from 71.7%(an all-time high) to 41.73%.
A crypto enthusiast with the handle “ImNotTheWolf” tweeted about altcoin season as well, saying:
Due to their volatile & illiquid nature, bottom levels on #altcoins likely hit before #ethereum or #bitcoin. I believe alts will outperform the majors since bag holders have already capitulated. Expecting consolidation, but overall $BTC.D to continue it’s downtrend.
Is this a sign that Altcoin season is approaching? Let’s delve a little deeper.
Altcoin Season: Is It Coming Soon?
For many in the cryptocurrency industry, “altcoin” is regarded as a disparaging term, demeaning anything that isn’t the original digital asset. Nonetheless, the Altcoin index is a useful tool for determining where investors’ minds are when it refers to diversification beyond blue chips.
How it works: Altcoin season is when more than 75% of the top 50 digital currencies (38 or more) outperform BTC over the last 90 days. Stablecoins and asset-backed tokens, such as wrapped Bitcoin and Lido Staked Ether, are excluded from the index. On the other hand, we’re officially in Bitcoin season if less than 25% of the top 50 digital assets outperform BTC.
As you can see on the Altcoin Season Index, only 25 of the top 50 digital assets by market capitalization have outperformed Bitcoin (BTC) in the last 90 days, indicating that we are neither in the Bitcoin season nor in the altcoin season. However, looking at the trend of the Altcoin Season Index, it’s evident that we’re not far from the much-touted “altcoin season.”
The last altcoin season began in the last weeks of 2020 and ended in May 2021. During this time, the price of ETH increased from $600 to more than $4,100, while the values of lesser currencies like Cardano (ADA) and Binance coin (BNB) increased dramatically (1,300% and 2,000% gains, respectively).
Is It a Good Time to Buy Cryptocurrency?
Past performance can not foretell future price movement, but we may seek trends and evaluate possibilities. Although bitcoin has been present since 2009, historical price data does not have the same weight as more recent data. This was due to the market being too young to obtain credible price data.
However, with time, the market and investors are both getting mature and have sufficient data to analyze the market.
As previously stated, Bitcoin’s dominance is waning, which bodes well for upcoming coins such as Battle Infinity (IBAT) and Tamadoge (TAMA). Due to high demand, the Battle Infinity presale sold out only 24 days into its 90-day presale. The next step on the roadmap is to list IBAT on cryptocurrency exchanges, the first of which is PancakeSwap.
Tamadoge (TAMA) is still on beta sale, which will last until September 2, 2022, at a reduced price. TAMA has already raised $196,016.59 USDT. If you are looking to invest in altcoin, it could be a good opportunity to buy Tamadoge
Check out how to set up a crypto wallet to buy Tamadoge.
Tamadoge (TAMA) – Next Big Meme Coin
- Beta Sale Ends Sept 2022 – tamadoge.io
- Deflationary, Low Supply – 2 Billion
- Move to Earn, Metaverse Integration on Roadmap
- NFT Doge Pets – Potential for Mass Adoption
- Play to Earn Utility – Rewards Token
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