Bitcoin's dominance is an important indicator for assessing investor cash flow.
The appearance of the 'death cross' after four years is not just a technical signal – but also a clear warning.
Although Bitcoin [BTC] ended the first week of 2025 at a high price, surpassing 102K USD after two weeks of market decline, its dominance has slightly decreased.
This could signal that altcoins are beginning to attract attention as investors eagerly diversify their portfolios.
Will the 2021 cycle repeat?
Typically, when Bitcoin's dominance decreases, this is often a strong signal that the altcoin season is about to begin. And currently, this hypothesis is further solidified.
Over the past week, the market has turned green, with large-cap altcoins recording double-digit gains. Although it is still early to make bold predictions, signals are emerging and this is a notable trend.
Why? Four years ago, Bitcoin started Q1 with a dominance of 72%, but in less than four months, that figure dropped below 40%, just as a 'death cross' appeared on the Bitcoin dominance chart.
The reaction is that Ethereum [ETH] rose from 737 USD in January to 4,183 USD in May, a leap of 467%. And remember: that is four times Bitcoin's 107% increase during the same period.
So does history repeat itself? The market seems to hint at that. In mid-November, a 'death cross' formed on the Bitcoin dominance chart for the first time in four years.
Source: TradingView
The result is? Bitcoin's market share has dropped from 60% to 54% in just two weeks. During the same period, Ethereum increased by 30%, closing above 4K USD.
But many things have changed in the past four years. Although a 'death cross' often warns of an altcoin price surge, it does not automatically mean Ethereum will lead.
The cryptocurrency landscape has evolved, and new candidates may emerge to attract attention.
Who will lead when Bitcoin's dominance decreases?
Interestingly, memecoins are creating a strong wave, topping the list of top gainers with weekly increases of over 50%. In fact, three of the top five tokens are meme-based, proving the rising madness of memes.
However, this trend also indicates that investors are hunting for quick, short-term profits, especially as Bitcoin surpasses 100K USD. Clearly, memecoins are on the rise.
Even more interesting is how meme-based tokens are outperforming traditional altcoins right now. For example, DOGE/BTC – is on the verge of breaking out with MACD turning bullish.
Source: TradingView
The bottom line? Investors seem more excited about 'hype' than long-term 'value', making the memecoin market a notable area.
As Bitcoin's dominance faces increasing pressure from those seeking cheaper, less volatile options, the spotlight on memecoins may shine even brighter.
