Ethereum Dominance Climbs as Altcoin Rotation Signals Early Altseason Setup

Speculative focus in the crypto market is shifting, with clear signs of capital rotation away from Bitcoin and toward Ethereum and mid-cap altcoins.

According to Glassnode, Ethereum’s perpetual open interest dominance has surged to nearly 40%, its highest level since April 2023. This level has only been exceeded on 5% of days since then, marking a strong pivot in trader sentiment.

The data suggests that traders are increasingly favoring Ethereum over Bitcoin for leveraged exposure, signaling renewed speculative appetite. As ETH dominance climbs, it is gradually eroding Bitcoin’s share of open interest—often a sign that broader altcoin engagement is picking up momentum.

Complementing this, trader Merlijn highlighted that Bitcoin’s momentum is stalling, while Ethereum and mid-cap coins are showing strong impulse signals.

According to the “Altcoin Vector” chart by Swissblock, 75% of tracked altcoins are currently displaying positive price impulses, consistent with previous cycles that triggered altseasons.

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The rotation pattern—Bitcoin cooling off, followed by capital flowing into Ethereum, and then rotating to smaller altcoins—is now clearly visible in on-chain data. Historically, this setup has preceded strong altcoin rallies.

If current trends hold, traders may be witnessing the early stages of a new altseason. Ethereum’s rising open interest dominance, paired with broad alt impulse metrics, suggests smart money is already repositioning.