"Bitcoin's Dominance Surges to 61.5% as Altcoins Struggle"

Bitcoin's dominance has surged to multi-year highs, nearing 62%, as altcoins struggle to gain traction. The total altcoin market capitalization has plummeted by 31.5% since the end of January, wiping out $460 billion in value. Despite a recent recovery, the altcoin market remains nearly 16% below its January levels and 28% short of its all-time high.

The CMC Altcoin Season Index, which tracks the performance of the top 100 altcoins relative to Bitcoin over the past 90 days, has dropped to 36, indicating that Bitcoin remains the dominant force in the market. Major altcoins like Ethereum (ETH), Solana (SOL), and Ripple (XRP) have seen mixed performance, with ETH declining 18% year-to-date and SOL rising 5%. XRP, however, has been one of the best-performing large-cap altcoins, gaining 21% year-to-date and surging 360% over the past three months.

Bitcoin's growing dominance has created a bottleneck for altcoins, preventing capital from flowing into them as it did in previous cycles. As of February 5, Bitcoin accounts for 61.5% of the total crypto market cap, its highest level since early 2021. This means that for every dollar invested in crypto, over 61 cents go into Bitcoin, leaving around 39 cents for the thousands of other coins combined.

Historically, capital in crypto markets has moved in phases, with Bitcoin absorbing liquidity first and then funds rotating into altcoins, triggering an altcoin season. However, the growing presence of institutional investors and the shift in speculative capital towards on-chain, low-cap tokens have disrupted this pattern. For altcoins to gain momentum, Bitcoin needs a prolonged stabilization period, allowing capital to rotate. Additionally, catalysts such as Ethereum upgrades, regulatory clarity, or broader adoption could accelerate this transition.

The way speculative capital moves in the crypto market has changed, and that shift could be one of the biggest reasons why a traditional altcoin season has yet to materialize. Analyst Miles Deutscher highlights the role of Pump.fun, a platform he says has directly correlated to the destruction of the altcoin market versus BTC. He explains that in previous cycles, speculative capital