The Reign Of Bitcoin Is Asserting Itself: Should We Flee From Altcoins?

For a few months now, Bitcoin has been more than ever at the forefront of the crypto market, reaching a level of dominance not seen since 2021. This surge leaves little room for other digital assets, and altcoins seem increasingly fragile in the face of this Bitcoin wave. So, facing this situation, should we distance ourselves from altcoins, or is it too early to draw definitive conclusions?

An Overwhelming Bitcoin Domination

On September 16, 2024, Bitcoin’s dominance reached 58%, a multi-year high reflecting investors’ renewed confidence in the asset.

This figure is not insignificant. It represents Bitcoin’s share of the total crypto market capitalization, and this growth has accelerated over the past two years. After the collapse of FTX in November 2022, which saw Bitcoin’s share drop below 40%, the trend has slowly but surely reversed.

Today, while Ethereum and other altcoins struggle to keep up, Bitcoin is asserting itself almost overwhelmingly.

The Ethereum network, for example, has seen its market share drop below 14%, a three-year low. This decline in Ethereum, considered Bitcoin’s main rival, shows how concentrated the current market dynamic is around BTC.

However, this extreme dominance of Bitcoin is not without risks. Such a massive market share can indicate a market too focused on a single asset, creating a dangerous dependency.

For altcoins, this can mean marginalization or even continued demand declines, putting projects in difficulty.

Altcoins: Threatened Assets or Opportunities to Seize?

As Bitcoin’s dominance reaches new heights, the question arises: do altcoins still have a future? On one hand, Bitcoin’s rise might scare some investors and push them to abandon altcoins to focus on the market leader.

On the other hand, this situation could open up buying opportunities for those who believe in a strong comeback of altcoins during the next “altseason.”

Experts are divided. Some, like analyst Rekt Capital, believe Bitcoin’s dominance could rise further, noting that a similar trend in 2019 pushed Bitcoin’s dominance to 71%. If this scenario repeats, altcoins risk being left behind with poor performance over a prolonged period.

However, other specialists like Cryptollica anticipate a reversal. They believe Bitcoin’s dominance could decline by mid-2025, opening the door for a new expansion phase for altcoins.

This “altseason” could result from a slowdown in Bitcoin, redirecting capital to smaller but equally promising projects.

It is also essential to consider that some altcoins, despite Bitcoin’s current dominance, continue to have strong use cases. Projects like Ethereum or Polkadot possess robust underlying technologies and dynamic ecosystems. This context could offer a refuge for investors willing to wait and see these altcoins regain their former glory.

Should You Flee Altcoins?

The choice to move away from altcoins is not as obvious as it seems. Sure, Bitcoin’s dominance is a crucial factor, but it’s essential to remember that the cryptocurrency market is notoriously volatile.

A rapid rise in Bitcoin could precede a major correction, allowing altcoins to regain ground.

Cautious investors might feel tempted to turn to Bitcoin, considered more stable and resistant to fluctuations.

However, those who believe in diversification know that some altcoins still represent interesting investment opportunities.

The crypto market has shown in the past that altseason cycles can emerge at unexpected times, offering substantial gains for those who have been patient. Furthermore, an unknown project is shaking the market.