Bitcoin has seen its dominance rise to 52%, attempting to break the $71,000 mark but falling just shy, currently hovering around $70,000 as of Thursday (March 28th).
Altcoins, on the other hand, have undergone a substantial retracement, leading to an increase in BTC dominance. Reports from CryptoPotato indicate that Ethereum (ETH) and other major altcoins have retraced significantly, causing a $50 billion dip in the crypto market cap, which now stands below $2.8 trillion.
Despite the ongoing downtrend in altcoins, analysts suggest that the Bitcoin halving event could pave the way for a decline in Bitcoin’s dominance, potentially opening up a bullish trajectory for altcoins. Notably, Michael van de Poppe stated that the reduction in BTC dominance post-halving could spark renewed interest in altcoins due to their currently low valuations.
After the halving, the #Bitcoin dominance is likely to start falling substantially.
The $BTC valuation of altcoins are super low, hence why there’s a strong interest in purchasing them. pic.twitter.com/8eDWKBmGXZ
— Michaël van de Poppe (@CryptoMichNL) March 27, 2024
Analysis by van de Poppe underscores Bitcoin’s significance as a leading indicator in the broader cryptocurrency market. It is a common occurrence that altcoins tend to rally following substantial Bitcoin growth, attracting retail and venture capital interest due to their lower valuations but potential returns.
BTC’s dominance is now mirroring early 2021 levels as per data from CoinCodex. Moreover, Grayscale outlined in a recent report a market trend where an increase in BTC dominance triggers a rally in altcoins. Despite recent price fluctuations in BTC, optimism prevails regarding the possibility of a new all-time high before the imminent April halving.
Furthermore, market experts speculate that Bitcoin’s bullish momentum might create pressure on short traders, potentially propelling the primary asset to “conservative” prices exceeding $100,000.
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