- BTC dominance remained at yearly highs for broader altcoin recovery to gain traction.
- But the early 2025 altcoin sell-off eased and bottomed out at the 2024 support level.
Bitcoin [BTC] dominance (BTC.D) has climbed higher in 2025 and dimmed the prospect of the much-awaited altcoin run-up.
It jumped 13% between January and April, shrinking the altcoin market (Total3, exclusive of BTC and ETH) from $1.13 trillion to $817 billion. That’s a 28% ($300B) decline in altcoin market size.
Altcoin rebound incoming?
Source: BTC dominance vs Altcoin market cap (Total3)
A rising BTC.D means more capital flows from the altcoin sector to the king coin. In fact, massive altcoin rallies, like during last November, always happen when BTC.D declines (capital flows from BTC to altcoins).
Although the BTC.D was above 64% and could extend to 66% or 70%, like in the 2021 cycle, the altcoin sell-off in 2025 has bottomed out. The altcoin market dump eased near the $750B market cap level.
There was a similar bottom pattern on the altcoin market when the top 10 crypto assets were excluded.
Source: TradingView (Altcoin marketcap vs. USDT dominance)
The chart showed that the altcoin market (excluding top 10 assets) rebounded at the $200 billion level, a key support zone in 2024 (cyan).
A closer look at the September-August 2024 period (white oval) showed that the altcoin market consolidated between 50WMA and 200WMA (Weekly Moving Averages).
The November rally happened after a breakout from the range.
If history repeats, a clearing of the 50WMA could push the sector higher towards the megaphone resistance near $500B.
At the time of writing, the segment was up 33%, suggesting traction amongst some altcoins.
In fact, the retreating USDT dominance (USDT.D) from nearly 6% obstacle could offer more fuel as traders deploy their stablecoins for favorite altcoin gems.
That said, the overall market was still in a firm BTC season, according to the altcoin season index (ASI) indicator on CoinMarketCap.
The ASI reading was 18, suggesting that BTC outperformed most altcoins in the past 90 days of trading.
Source: CoinMarketCap
Only Fartcoin [FARTCOIN], PancakeSwap [CAKE], and Monero [XMR] were some top performers relative to BTC in the past three months. They were up 8%, 2.8%, and 19%, respectively, while BTC dipped 10%.
In conclusion, the altcoin sell-off has eased and bottomed out, suggesting a likely broader rebound could be possible. But a confirmed recovery could happen only if BTC dominance retreated.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
