Rising Bitcoin Dominance Puts Altcoin Gains at Risk

The analysts behind Glassnode have expressed concern that the recent downturn in the crypto market could derail any momentum for altcoins.

Jan Happel and Yann Allemann, posting as Negentropic on social media, noted that the so-called “altcoin season,” which began in late November, might be coming to an abrupt halt following significant losses in the past week.

They suggest that a cautious sentiment toward altcoins is likely to persist unless Bitcoin regains a key psychological threshold. As Bitcoin dominance rises, surpassing 59% of the crypto market cap, altcoins are struggling to maintain support levels, signaling a stronger focus on Bitcoin in the market.

The analysts believe a recovery for altcoins could only occur if Bitcoin stabilizes above $100,000, creating a more favorable environment for assets now in accumulation zones. For the moment, Bitcoin’s prominence appears to be overshadowing its smaller counterparts.

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On the Bitcoin front, Glassnode highlights shifting dynamics among investors. While long-term holders are offloading their holdings, short-term participants are stepping in aggressively.

Whales are quietly accumulating, miners remain neutral, and the broader market sees a redistribution of holdings, as new entrants absorb the selling pressure.

Alexander Zdravkov