Altcoin season may be around the corner if a major indicator, the Bitcoin dominance follows previous patterns and goes downward from here.
This is the position of crypto analyst Ash Crypto, who shared data on 23 January showing the similarity of the current pattern with that of 2021 just before the alt season that year.
Something about Bitcoin dominance
Bitcoin dominance is an indicator that shows how much of the crypto market is accounted for by only Bitcoin. It is also a major indicator when it comes to determining the commencement of the alt season.
The higher the dominance of Bitcoin over the market, the lower the chances of an alt season. This means that the dominance has to crash for altcoins to start rallying significantly.
The crash is due to liquidity flowing from Bitcoin into altcoins, and is usually a sign that altcoin investors look out for. Generally, the dominance needs to drop sub 50% for an alt season to start.
According to Ash Crypto’s chart, the market now looks a lot like it did in 2021 just before the Bitcoin dominance crashed, leading to an altcoin rally.
If the pattern repeats itself, we are really close to the long-awaited alt season. Meanwhile, Bitcoin’s dominance is still quite high at 57% so it remains to be seen what happens in the coming days or weeks.
Ethereum delaying the ride
As important as Bitcoin Dominance is, there are other factors that can determine when the alt season begins, one of which is \ethereum.
According to Ash Crypto, the second largest crypto by market cap needs to break above $4,200 to kickstart the altcoin rally.
Ethereum is trading at $3,200 at the time of reporting this news, which means it’s still a long way from meeting this condition but fingers remain crossed.
What do you think?
Join Techgaged on Telegram
Get first-access to daily trending tech stories, AI breakthroughs, and more, before it hits your feed.
