- Altcoins have been struggling under Bitcoin’s growing dominance lately
- Could a new kind of altseason eventually shift the momentum back from Bitcoin?
June has historically been a month where Bitcoin [BTC] asserts its dominance, and this year is no exception. In fact, BTC.D has climbed above 65%, marking a new cycle high.
However, this year, geopolitical tensions have added a new variable to the mix. You’d typically expect capital to flow into speculative assets to leverage short-term volatility. Instead, BTC.D broke higher.
Is this a turning point for the market? One where macro FUD further solidifies Bitcoin’s safe-haven narrative, a role once reserved for altcoins?
Altseason indicator drops as capital consolidates into BTC
To understand the relationship between Bitcoin and altcoins, we need to take a step back.
During the 2022 bear market, a series of cascading shocks sent BTC tumbling, resulting in a 65% net yearly loss and closing the cycle at $16,531.
Interestingly, Q2 of that same year marked Ethereum’s [ETH] peak performance against Bitcoin. ETH attracted rotational capital and even triggered a mid-August breakout, outperforming BTC during that phase.
In short, macro headwinds, including the Fed’s aggressive rate hikes and the collapse of LUNA/UST, pushed investors to seek hedges in alternative assets, briefly giving altcoins like Ethereum an edge.
Three years later, the tide has turned.
The altseason indicator is at a two-year low, altcoins are posting double-digit monthly losses, and Bitcoin dominance has surged to a four-year high – All while macro pressures continue to test bull conviction.
Source: TradingView (BTC/USDT)
What’s changed? The rise of institutional capital.
Large investors now dominate market flows. And, their preference for BTC, as both a macro hedge and liquidity anchor, is keeping dominance elevated.
Retail’s catching on too. With Bitcoin showing stronger capital resilience, many are choosing to park their funds in BTC for long-term stability, rather than chasing high-beta altcoins for short-term speculative returns.
Therefore, as long as the market stays choppy and macro risks hang around, that altcoin rotation might stay on the sidelines.
Altcoin season 2.0 – Built on utility, not hype
We could be heading into a different kind of altseason, not one driven by “hype,” but by real utility. This time, strong Layer 1s like Ethereum, Solana [SOL], and XRP might lead the way.
These networks do more than just compete with Bitcoin. They’re building the foundation of the new digital economy and leading trends like RWAs, DePIN, and stablecoins.
XRP’s new stablecoin, RLUSD, is a good example. It’s already in the top 20 with a $428 million market cap and is tapping into the huge $256 billion stablecoin market.
Source: CoinMarketCap
Still, for a true altseason to take off, the market needs a fresh, strong catalyst, like NFTs or memecoins were in the past. That being said, we have been seeing a clear shift in market behavior.
Bitcoin’s dominance, fueled by institutional flows, isn’t slowing down. And yet beneath the surface, altcoins are pivoting towards real-world applications. And, that shift could be what eventually flips the narrative back in their favor.
