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Title: Is Altcoin Season Here Again After Bitcoin Dominance Falls By 2%
As the crypto market continues to witness unprecedented growth, a recent development has caught attention – Bitcoin Dominance (BTC.D) has taken a hit of around 2%, leading many to wonder if altcoin season is finally upon us. In this article, we’ll delve into the details and examine whether or not this supposed decline in BTC.D translates to an imminent altcoin season.
Before diving into the main topic, it’s essential to understand that the recent performance of the altcoin market has been somewhat decent against Bitcoin since June 27th. However, it would be premature to assume that we’re already in the midst of an altcoin season similar to those experienced previously.
The key indicator for determining the onset of an altcoin season is not just a single event but rather a series of events and trends. The crypto community often relies on the Altcoin Season Index (ASI), which gives us valuable insights into the market’s sentiment.
Currently, the ASI sits at approximately 33, indicating that we’re still far from entering an altcoin season in the true sense. Typically, such an event wouldn’t start until the index breaches the 75-mark.
On the other hand, a study of the BTC.D metric reveals a significant 2% drop in Bitcoin’s dominance over the past few days. This decline is considerable enough to spark speculation that capital might be rotating out of the leading cryptocurrency and into alternative assets. The graph shows a notable downtrend since June 27th.
It becomes crucial to note here that, in the last two cycles (2017 and 2021), this level of divergence would have resulted in an altcoin season with the market participants rushing into other digital currencies for potentially higher returns.
However, it is essential not to be too hasty or overly optimistic about these developments as a rally past $122,000 without overheating could imply that there’s still room for growth within the Bitcoin market.
The recent performance of Ethereum, which has seen a significant surge towards the $3,000 level and potentially breaking higher due to high demand, might signal an opportunity for altcoins.
Source: ambcrypto.com
