A cryptocurrency analyst has revealed the latest trends in Bitcoin’s (BTC) dominance in the cryptocurrency market, suggesting a possible shift in investor sentiment as they diversify their portfolios beyond the pioneer cryptocurrency.
Bitcoin’s dominance is waning
Popular cryptocurrency analyst and trader Michael van de Poppe shared valuable insights on X (formerly Twitter) on Monday, April 22, regarding Bitcoin dominance and investor sentiment towards the cryptocurrency following the halving event.
The halving event, which reduced miners’ block rewards by 50% and the cryptocurrency’s supply by 50%, took place in the early hours of April 20. The previously anticipated event sparked excitement among cryptocurrency enthusiasts and investors as market analysts predicted a bull run following the event.
However, the end of the fourth Bitcoin halving cycle failed to have any profound impact on Bitcoin’s price, especially compared to its massive run to all-time highs before the halving, which saw Bitcoin surge to over $75,000 in March amid a surge in demand for spot Bitcoin exchange-traded funds (ETFs).
As of writing, the cryptocurrency is trading at $66,205, according to CoinMarketCap, down more than $8,000 from its previous all-time high.
Poppe explained that the entire cryptocurrency market has been on an upward trend as the Bitcoin halving event has been completed. The analyst confirmed that Bitcoin's dominance in the crypto market is significantly weakening. In addition, data from TradingView shows that Bitcoin's dominance in market capitalization is currently 55.29%, down 0.26% from the past week.
This decline in dominance suggests that investors may be starting to move away from popular cryptocurrencies and diversify their holdings into other digital assets. Pope calls this shift a “rotation,” emphasizing that the movement is starting slowly but steadily.
He shared a price chart of Bitcoin against Tether (USDT), showing BTC’s price action from February to April. The crypto analyst predicted a support level, identifying $57,000 as a potential bottom if BTC fails to break above $70,300.
Is altcoin season coming?
Altcoin seasons usually occur when the prices of smaller cryptocurrencies surge and outperform Bitcoin. This period usually follows a significant drop in Bitcoin’s dominance in the cryptocurrency space.
“If Bitcoin’s dominance index continues to weaken, investors’ attention will turn to altcoins and we may see another altcoin season,” said one cryptocurrency community member.
In addition, Pope also declared that "the era of altcoins is coming." He revealed the strategy of taking long positions in anticipation of this potential rebound, and emphasized that the altcoin bull market will depend on Ethereum's performance in the market and the possibility of an Ethereum spot ETF.
Disclaimer: The above article only represents personal opinions and is not intended as an investment reference.
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