XRP News Today: Altcoins Plunge 7% as Bitcoin Dominance Surges to 65% Amid Geopolitical Tensions

Altcoins are experiencing a decline as investors shift their focus to Bitcoin amidst escalating geopolitical tensions and a risk-off environment. The Altcoin Season Index, which tracks the performance of non-Bitcoin assets relative to Bitcoin, has dropped to 12, its lowest point in nearly a year. This decline indicates a significant underperformance of altcoins, reflecting a broader trend towards safer assets in uncertain markets.

The trend has intensified over the past month due to tensions between Israel and Iran, as well as fears of escalation involving the United States. These geopolitical uncertainties have pushed investors towards more resilient assets like Bitcoin. Shawn Young, Chief Analyst at MEXC Research, noted that the outlook for a traditional altcoin season remains unclear. Past cycles have often seen altcoins gain momentum in the latter stages of a bull run, but current market conditions suggest a different path. Institutional players are now setting the tone, and their preference for Bitcoin, seen as both a hedge and a liquidity anchor, continues to suppress the altcoin rebound.

Young added that as long as volatility remains increased and macro risk lingers, capital rotation into altcoins may remain limited. This shift became evident over the weekend, when Ethereum fell to $2,130, its lowest since May, while Solana, XRP, and other prominent altcoins saw drops of over 7%. ETH has recovered to $2260 as of press time. Although Bitcoin briefly dipped below $100,000, it quickly recovered to $101,000. As a result, its dominance over the total crypto market has surged past 65%, the highest since early 2021.

Despite the current decline, there is still potential for a new type of altseason centered on strong Layer-1 networks like Ethereum, Solana, and XRP. These platforms underpin vital infrastructure such as real-world asset tokenization, DePIN protocols, and stablecoin issuance, which are areas that are gaining traction among institutional investors. Young noted that interest in these high-upside altcoins could return if Bitcoin stabilizes above $100,000 and macro risks ease. In addition, launching spot ETFs for these L1s may also serve as a future catalyst that could renew interest in the digital assets.