Bitcoin Dominance Hits 65% as Altcoins Lose 36 Billion Dollars

Bitcoin's dominance in the cryptocurrency market has been a persistent theme this summer, with the digital currency continuing to outperform alternative cryptocurrencies, or altcoins. Since January, Bitcoin's dominance has hovered above 60%, even reaching 65% at one point. This technical supremacy is attributed to the Bull Market Support Band (BMSB), a pair of moving averages that acts as a trampoline for Bitcoin's dominance, causing it to bounce back whenever it falls. This dominance has left altcoins struggling to gain traction, with technical signals like RSI and MACD indicating established inertia in the market.

One of the key factors contributing to Bitcoin's dominance is the lack of capital flowing into altcoins. According to an analysis, nearly 36 billion dollars were withdrawn from alternative projects over one year. This reversal in momentum has been evident since December 2024, leading to a collapse in the altcoin market. Institutional investors, who prefer the stability and regulatory compliance of Bitcoin, have shunned altcoins, further exacerbating the capital outflow. The current economic environment, with the Federal Reserve maintaining key rates between 4.25% and 4.50%, has also contributed to the lack of liquidity in the altcoin market.

Despite the bleak outlook for altcoins, some analysts suggest that the altseason may have already begun without widespread recognition. There are weak signals of renewed interest in certain crypto-related stocks and ether trading volumes. Some alternative projects are also ramping up their marketing efforts to attract attention. However, the Altseason index remains low, and the withdrawal of 36 billion dollars from altcoins is a strong indicator of the ongoing crisis in the altcoin market. While it is difficult to assert that the altseason is underway, it is equally risky to dismiss it entirely.

In conclusion, Bitcoin's dominance continues to overshadow altcoins, with institutional investors favoring the stability and regulatory compliance of Bitcoin. The lack of capital flowing into altcoins, coupled with the current economic environment, has left altcoins struggling to gain traction. While there are weak signals of a potential altseason, it remains to be seen whether altcoins will be able to break free from Bitcoin's shadow and attract the necessary capital to thrive.