Bitcoin Dominance Continues to Rise Amid Anticipation of an Altcoin Season at the Start of the Year

The crypto market has faced harsh headwinds in the last two weeks, reshaping whale holdings and asset dominance. This stems from a flurry of macro factors as

Bitcoin (BTC) price action remained the center of attention in January, with the asset’s dominance continuing a trend observed in 2024. BTC price surged by 55% in the last three years, outpacing gains by several altcoins. This occurrence was anticipated by many crypto users and traders.

After a strong rally by Bitcoin, altcoins usually perform better once BTC price hits a cycle peak. However, shaky trades and more investor appetite in BTC spiked its dominance while altcoins struggled.

Ethereum (ETH), an asset expected to ignite the season, continued a sideways pattern for the last two to three quarters, even after the approval of spot Ethereum ETFs.

ETH price trades at $3,219, dropping below the $3.5K after bulls anticipated a run to $5K. This was heightened by XRP’s stellar climb above $3 with billions in its market cap. Solana and Cardano also made significant gains last quarter with a similar rise in decentralized finance (DeFi) trading volumes.

“Many experts, including myself, predicted that January 2025 would mark the official start of the altcoin season, especially after #Trump inauguration. But now, as the month comes to a close, we still haven’t seen any significant movement… Over the past two years, Bitcoin has surged by more than 500%, yet Ethereum hasn’t even surpassed its previous ATH. And historically, Ethereum leads the altcoin season,”

Institutions Backed Bitcoin Price Surges

Large-scale market players were among the factors behind the BTC price surge. Following the approval of spot Bitcoin ETFs, the asset’s pitch maintained an upward momentum.

Tapping $73K in Q1 2024, it broke $93K after Donald Trump’s election win in November and eventually crossed $107K before the recent corrections.

The inflow of funds and confidence in clearer regulations in the country led to more investors backing the market leader above other assets. Moves to pass a Strategic Bitcoin Reserve Bill in Congress and similar efforts in states resulted in higher Bitcoin dominance.