Bitcoin Dominance Ratio Falls Below 50% as Altcoin Season May Have Already Begun

According to Binance, new altcoins are seeing shifting patterns in volume distribution, providing early evidence that the altcoin market is gaining momentum relative to Bitcoin's dominance.

Cryptocurrency investors have been eagerly awaiting the fabled "Altcoin Season," a period when a significant percentage of top altcoins outperform Bitcoin over a specific timeframe. While many reports have stated that this season is yet to arrive, a growing body of market data suggests otherwise.

According to recent data from Binance, new altcoins are seeing shifting patterns in volume distribution, providing early evidence that the altcoin market is gaining momentum relative to Bitcoin’s dominance.

How to Enter the Altcoin Season

Generally, we enter the Altcoin Season when 75% of the top 50 coins perform better than Bitcoin over the last 90 days. The crypto market intelligence platform, Token Terminal, calculates and visualizes this phenomenon with its Altcoin Season Index.

This threshold was crossed in early 2025, with approximately 78% of top altcoins outpacing Bitcoin returns over the 90-day period.

The Bitcoin Dominance ratio—Bitcoin's market capitalization as a percentage of the total cryptocurrency market—has fallen below 55% for the first time since mid-2023. This decreasing dominance typically signals capital flowing from Bitcoin into alternative cryptocurrencies.

While trading volume on Binance still shows Bitcoin leading in absolute terms, the proportion of altcoin trading is steadily increasing. As of November, the volume of top 50 altcoins (excluding stablecoins) on Binance is about 38% of total Bitcoin volume.

Current performance data from Binance shows an average increase of 47% year-to-date for Layer-1 alternatives, significantly outperforming Bitcoin's 22% growth during the same period.

DeFi tokens have experienced even stronger performance, with an average gain of 83% across the top 20 DeFi assets available on Binance and other exchanges.

The Altcoin Season Index currently registers a score of 20, firmly in "Bitcoin Season" territory. Generally, scores above 75 indicate that we have entered this phase. This is despite the altcoin market capitalization having grown by approximately $487 billion in 2025 alone, representing a 31% increase that outpaces Bitcoin's market cap growth of 19%.

Bitcoin Price Remains Bounded

While Bitcoin remains the dominant cryptocurrency by market capitalization, its price action has been consolidating after reaching new all-time highs earlier this year. According to price data from Binance, Bitcoin has been trading in a narrower range of $69,000 to $78,000, while select altcoins have broken out to new local highs.

This pattern of Bitcoin consolidation often precedes periods of altcoin outperformance as traders on Binance and other platforms seek higher returns in alternative assets.

Bitcoin's decreasing volatility, now at its lowest levels since November 2023, reflects a relaxing of the cryptocurrency market since the November Election.

Historically, periods of low Bitcoin volatility have coincided with increased risk appetite for altcoin exposure.

Expert Opinion

Cryptocurrency market analysts have acknowledged that with the general downturn of the cryptocurrency market, Altcoin Season may be delayed until Bitcoin's market dominance turns around.

“Altcoins have been steadily losing ground to Bitcoin, and I believe altcoins won't have a sustained season until 2025,” cryptocurrency analyst Benjamin Cowen said in a recent YouTube video.

“Historically, alt seasons follow a strong Bitcoin rally, so unless Bitcoin experiences a parabolic run, we might not see an alt season.”

Technical indicators further support this view.

Prior to January 17, the Altcoin/Bitcoin Market Cap Ratio had broken above its 200-day moving average—a technical signal that has historically preceded extended periods of altcoin outperformance.

Trading volume on Binance for altcoins increased by 67% in Q1 2025 compared to Q4 2024, while Bitcoin's volume increased by only 23% during the same period.

However, recent activity in the market has largely wiped out any confidence—in the short-term—of an Altcoin Season in 2025.

Investment Implications

For cryptocurrency investors, this data suggests a potential shift in optimal portfolio allocation. While Bitcoin remains an essential cornerstone of any cryptocurrency portfolio, the current market dynamics may favor increasing exposure to select altcoins.

Traders on Binance have been adjusting their portfolios accordingly, with platform data showing increased altcoin position sizes relative to Bitcoin holdings.

However, it's crucial to remember that Altcoin Seasons are typically characterized by higher volatility and risk.

Investors should conduct thorough research and consider their risk tolerance before significantly altering their cryptocurrency allocations.

Overall, while many investors have been waiting for Altcoin Season to arrive, comprehensive market data suggests it may have already begun.

Multiple indicators including the Altcoin Season Index, Bitcoin dominance ratio, and relative performance metrics all point toward confusion of when an active Altcoin Season may begin.

News data source: kdj.com

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