The market share of Bitcoin surged to 61.61%, reaching a new high since March 2021, indicating that Bitcoin is rising on its own. This article compiles historical data to reveal that when BTC.D drops below 50% and further declines to the 40% level, it may be the best time to capture the explosive growth of altcoins. However, could the meme season become a new altcoin season in this cycle?
Bitcoin strongly broke through $97,000 today at noon, reaching a new historical high of $97,662 just before the deadline, with a nearly 24-hour surge of 5.58%.
In this context, TradingView data shows that Bitcoin's market share (BTC.D) soared to 61.61%, reaching a new high since March 2021. There is still momentum to continue climbing before the deadline, indicating that the cryptocurrency market is currently dominated by Bitcoin's rise.
When will the altcoin season arrive?
In the cryptocurrency market, when Bitcoin is leading alone, it often means the market is still in its early stages, and the altcoin season has not yet officially arrived. According to historical cyclical patterns, after Bitcoin leads, market funds gradually flow into other mainstream coins (such as ETH, SOL, etc.) and small-cap tokens (altcoins), ultimately leading to a full-blown 'altcoin season'.
In this process, BTC.D is an important indicator for observing the rotation of market funds. Although the price of Bitcoin may continue to rise, the increase will gradually be surpassed by other cryptocurrencies, causing BTC.D to slowly decline from its high. Especially when BTC.D begins to plummet sharply from its peak, it usually indicates that market funds are flowing into altcoins, which is a significant signal for the start of the altcoin season.
Past cycles of cryptocurrency market fund rotation. Source: @MustStopMurad
BTC.D reveals market rotation
Through the analysis of historical data, we can clearly understand the key levels of BTC.D and its correspondence with market cycles. Here are the BTC.D levels of the three main altcoins when they reached historical highs according to CoinGecko data:
SOL: Currently only 9.9% away from the historical high of $259.96 on November 6, 2021, when BTC.D was around 43%.
XRP: Still 67.4% away from the historical high of $3.4 on January 7, 2018, when BTC.D was around 40%.
ADA: Still 74.6% away from the historical high of $3.09 on September 2, 2021, when BTC.D was around 41%.
Although the timing for these tokens to reach historical highs varies, their commonality is that BTC.D is around 40%. This ratio is also the low point of BTC.D during the 2021 bull market, and during the bull market at the end of 2017, BTC.D once dipped close to 30%.
Therefore, when BTC.D falls below 50% (indicating that Bitcoin is no longer the sole leader) and further declines to the 40% level, this period may be the golden time for the altcoin season. From historical experience, this is the best time to capture the explosive growth of altcoins.
Will the meme season replace the altcoin season?
However, it is believed that everyone has felt the difference in this bull market compared to the last one, with Ethereum no longer leading other mainstream coins and meme coins blooming everywhere. Therefore, the 'cult leader' of meme coins, Murad Mahmudov, recently shared the left image, indicating that the meme season of this cycle is a brand new altcoin season that many are waiting for:
Bitcoin leads => SOL catches up => DOGE rises, driving large-cap meme coins => Meme season fully erupts
But of course, investors in Ethereum still believe, as shown in the right image, that everything will ultimately come around to Ethereum. What will the outcome be? What do you believe? The dynamic field will continue to track and report.
