Bitcoin Dominance — is an indicator that reflects Bitcoin’s market capitalization share relative to the entire crypto market. It is calculated using the formula:
BTC Dominance = Market Capitalization of Bitcoin / Total Market Capitalization of Cryptocurrencies × 100%
This indicator shows the strength and influence of the first cryptocurrency on the market. If dominance is rising, investors are favoring Bitcoin. If it is falling, capital is flowing into altcoins.
Contents
Why track BTC dominance
Analyzing BTC dominance helps:
- Assess market phases: ‘altseason’ or ‘bitcoin season’
- Predict trends and risks
- Make diversification decisions for the portfolio
Traders use this indicator as a sentiment indicator: a high dominance level indicates conservative investor behavior, while a decrease indicates increased risk appetite.
Bitcoin Dominance Chart: where to look
🔍 Popular platforms for analyzing dominance:
- TradingView — ticker BTC.D
- CoinMarketCap — in the ‘Global Charts’ section
- CoinGecko — ‘Market Cap Dominance’ tab
How to read the BTC Dominance chart:
- Increase in the indicator → interest in Bitcoin
- Decrease → capital flows into altcoins
- Sideways movement → market in uncertainty
Interpreting the dominance chart together with the BTC price and the capitalization of other coins allows conclusions about the current market cycle.
Bitcoin Dominance forecast for 2025
Analysts expect that in 2025, Bitcoin’s dominance may change significantly depending on several factors:
Potential scenarios:
1. Increase in dominance to 55–60%
- Possible in case of a repeat of the ‘bear market’
- Investors will seek a safe haven in BTC
2. Decrease to 35–40%
- If an active alt season starts (like in 2021)
- The emergence of new trends (AI tokens, Web3, DeFi 2.0)
- Active trading of meme coins and new projects
Current level (May 2025):
- ~52% according to CoinMarketCap
- Bitcoin still leads, but pressure from altcoins is increasing
The impact of Bitcoin dominance on altcoins
When BTC dominance is rising:
- Altcoins generally decline against the dollar and particularly against BTC
- Risks are increasing: less liquidity and interest in ‘secondary’ assets
When BTC dominance is falling:
- Altcoins start to rise faster
- Opportunities for short-term and medium-term profit arise
- The so-called “alt season”
Alt season is the period when altcoins significantly outperform BTC in returns. During such periods, it is possible to see X2–X10 gains in a short time on mid and small-cap tokens.
How to use BTC dominance in trading strategy
Tips for traders:
- Watch the trend: rising BTC dominance is a reason to cut positions in alts
- Look for divergences: if the price of BTC falls while dominance rises — altcoins may be under pressure
- Combine with other indicators: RSI, volumes, volatility
- Take profits at the peaks of the alt season — sharp dominance declines rarely last long
Conclusion
Bitcoin Dominance — a key indicator of the crypto market that helps assess risks and look for entry points. Understanding its dynamics is important for both holders and active traders.
Against the backdrop of growing interest in alts, Web3, DeFi, and meme coins in 2025, BTC dominance will remain a focal point for all market participants.
Frequently Asked Questions (FAQ)
🔹 What level of dominance can be considered the start of an alt season?
— Typically, active growth of alts begins when it drops below 45%.
🔹 Can Bitcoin’s dominance drop below 30%?
— Historically, this has not been observed, but theoretically it is possible with mass growth of altcoin ecosystems.
🔹 Can BTC Dominance be used as a trading signal?
— Yes, especially in connection with BTC price, volume indicators, and trends.
Join MEXC and Start Trading Today!
