Bitcoin News Today: Altcoin Season Kicks In as Bitcoin’s Grip Begins to Slip

Bitcoin’s market share in the cryptocurrency space has shown signs of weakening, with analysts and market indicators pointing to a possible shift in investor sentiment from Bitcoin to alternative cryptocurrencies. Bitcoin dominance, which measures the proportion of Bitcoin’s market capitalization relative to the total cryptocurrency market, is currently at 57.60%, down from 61.72% at the start of August and marked by a 4.13% drop in the past month [2]. This decline has been attributed to a break below a two-year rising trendline, a development that several analysts have flagged as a precursor to an altcoin season [2].

Crypto analyst EGRAG CRYPTO has predicted that Bitcoin dominance could fall as low as 35%, a level not seen in years. This forecast is based on historical patterns, which show that whenever Bitcoin dominance closed below the 21-week EMA, it led to sharp declines, with an average drop of 43.34% observed in past cycles [1]. If this pattern continues, the market may witness one of the strongest altcoin seasons in history, characterized by a massive rotation of capital from Bitcoin into Ethereum and smaller-cap altcoins. EGRAG has emphasized the transformative nature of such market shifts, calling it the “mother of all altseasons” [1].

The trend is already gaining momentum. Ethereum’s dominance has increased by 2.8% in the past day, reaching 14.5% of the crypto market [2]. Meanwhile, the total market cap of altcoins has grown from approximately $1.4 trillion at the end of July to nearly $1.8 trillion in recent weeks [2]. This growth suggests that investors are increasingly allocating capital to altcoins, particularly as Bitcoin’s price has declined by 4.3% in the past month, trading at around $112,505 [2]. Analyst Ito Shimotsuma has noted that Bitcoin dominance is showing one of the weakest setups in the market, which he views as a bullish signal for altcoins [2].

Venture capitalist Tim Draper has also weighed in on the evolving market dynamics, suggesting that altcoins may ultimately make Bitcoin better by serving as testing grounds for network upgrades. He drew parallels between Bitcoin and Microsoft in Web2, where smaller applications were eventually ported to the dominant platform. According to Draper, the same gravitational pull is happening in the crypto space, as engineers experiment with altcoins and later bring their innovations to Bitcoin [3]. Despite this, data from Electric Capital indicates that Bitcoin lags behind Ethereum in terms of developer activity, with only 2,583 active developers on Bitcoin compared to 12,931 on the EVM stack [3].

CryptoQuant analyst Axel Adler has noted that shrinking altcoin balances on exchanges are another sign that an altcoin season could be on the horizon. He highlighted that average monthly inflows have dropped to $1.6 billion, significantly below the yearly average of $2.5 billion, which historically precedes altcoin rallies [2]. Additionally, the Altcoin Season Index has climbed to 71, nearing the threshold of 75 that traditionally signals the start of a strong altcoin season [2].

As the market continues to evolve, Bitcoin’s dominance remains a key indicator for investors and analysts alike. While Bitcoin still holds a majority of the crypto market, the data suggests that the balance of power is shifting. If the current trend continues, it could mark the beginning of a prolonged period of growth for altcoins, potentially reshaping the investment landscape in the crypto space.

Source:

[1] Bitcoin Dominance Could Drop to 35%, Analyst Warns (https://cryptodnes.bg/en/bitcoin-dominance-could-drop-to-35-analyst-warns/)

[2] Bitcoin Dominance Breaks Below 2-Year Trendline, Is ... (https://thecryptobasic.com/2025/08/25/bitcoin-dominance-breaks-below-2-year-trendline-is-altcoin-season-here/)

[3] Tim Draper Says Altcoins Could Help Bitcoin Evolve and ... (https://cointelegraph.com/news/altcoins-help-bitcoin-grow-tim-draper)