Congratulations BTC.D reached 60% 🎉🎉🎉

BTC.D (Dominance) - An Unreliable Indicator?

Since Bitcoin's peak (ATH), its value has only decreased by less than 10%, but many altcoins have split 2-5, even 10-15 times. In theory, BTC Dominance (BTC.D) should have increased sharply to 70-80%. But in reality, BTC.D only increased by 6%. Why is that?

1. Stablecoin development:
Stablecoins such as USDT, USDC, and FDUSD are continuously printed in huge quantities, but do not directly affect the price of altcoins. They account for the majority of the market capitalization but do not increase the cash flow into Bitcoin. This makes BTC.D not truly reflect the cash flow trend.

2. New tokens distort the data:
New tokens such as memecoin and gamefi continuously appear, sucking liquidity from old altcoins. Money flow does not focus on old altcoins but spreads to emerging coins, causing BTC.D to decrease but money flow does not flow into altcoins. For example, Not, Hmstr of gamefi or most recently the Goat project - a meme coin about AI that reached a capitalization of nearly 1 billion dollars after only 14 days of launch

3. Over-reliance on technical analysis:

Drawing chart lines predicting that BTC.D will increase to a certain level and then decrease sharply to trigger altseason has become a popular belief. But that is just a temporary dose of dopamine that makes many traders believe that when BTC.D reaches a certain ceiling, altcoins will explode again. This is a sophisticated manipulation trick from market makers (MMs), making it easy for you to be led along an existing price path. When fluctuations occur, you find ways to justify yourself to legitimize this result, instead of clearly seeing the truth.

#MGSTRADING #Dominance #BTC☀