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After the explosive rally in November, the price of BTC in December begins to lose pace against the push of alternative currencies. As a consequence, Bitcoin’s dominance has experienced a marked decline in recent days and reflects 56.13% at the time of writing this note.
It is worth remembering that the domain reached 61.75% on November 21. Meanwhile, the rest of the market followed at a slower pace, including the explosive memecoins. Now, BTC’s fuel at this stage seems to be running out and it is the turn of altcoins.
Now, the 90-day average performance of these tokens comfortably exceeds that of the reigning Cryptocurrency. According to data from the Blockchain Center portal, 38 of the main 50 altcoins surpass BTC in performance in these three months ending this Tuesday. This means that we are officially in an Altcoin season, according to that portal.
According to the parameters of this index, at least 75% of the coins must surpass BTC to enter an altcoin season. Now, the indicator marks 80%, confirming the market’s timid entry into this new stage of low Bitcoin dominance.
Bitcoin dominance collapses and opens the door for an altcoin season. Source: TradingView
What does Bitcoin’s low dominance reflect?
Bullish Bitcoin investors bet heavily on the currency following Donald Trump’s victory in early November. However, few imagined that the price would face strong resistance at the psychological barrier of $100,000. In fact, the $100K became a Chinese wall that leaves no room for maneuver for capital.
Thus, after several breakout attempts, investors are at a point of relative disinterest. Thus, they prefer to explore other tokens that show better performance. This herd movement means that this time it is the price of Bitcoin that lags behind the push of other currencies.
In a constant decreasing line, the weight of Bitcoin in the market is becoming less and less. The rise of other currencies and projects, as well as investors’ desire to create more diversified portfolios, is causing BTC’s market dominance to plummet.
Generally speaking, alternative tokens, or altcoins, continue to gain the attention of investors. In simple words, particular cases such as Stellar’s XLM, Ripple’s XRP and even Cardano’s ADA present themselves as irresistible options.
Many investors choose to abandon a portion of their BTC holdings to open operations with other tokens. When this trend becomes persistent, that is when altcoin season occurs, as is the current case.
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