The dominance of Bitcoin, the largest cryptocurrency in the market, is declining. Will altcoin prices, which have lost an average of 70% from their peaks, enter the recovery process?
While the world's largest cryptocurrency has lost dominance in recent weeks, smaller and lesser-known tokens are outperforming Bitcoin in a new altcoin season. Other altcoins have outperformed Bitcoin for two months in a row, along with major projects like Solana, Cardano, and Avalanche, which we looked at over the top 100 tokens. Meanwhile, the data shows more investor interest in these smaller tokens. In a memo last weekend, BlockFi noted that its clients had recorded a “spin” towards alternative coins.
“Other tokens have been outperforming Bitcoin for the past two months – we call it altcoin season,” said Joseph Hickey, BlockFi’s head of global trade, in a statement, noting in particular tier 1 projects competing with Ethereum.
The crypto ecosystem has grown tremendously over the past two years and all kinds of crypto-centric products have seen a boom. New companies were formed during the pandemic, NFTs had a big break, and alternative coins took on new importance as investors tried to move away from big cryptocurrencies.
According to data from CoinMarketCap, Bitcoin's market share has dropped from 65% at the beginning of 2020 to around 40%.
The term “alt season” has been used many times in the past. But analysts say this time is different. With the decentralized finance called DeFi, there are those who say that this time the rise of altcoins is revolutionary.
Many liken it to the early days of the internet, when a few companies like Microsoft and Apple dominated the space. For a long time, the market was dominated by only Bitcoin and Ethereum. However, this dominance is now very strong and seems to be slowly falling apart with different opponents.