StrategyIntermediate#Market Structure#Sentiment
BTC Dominance
B
Definition
The percentage of the total crypto market cap accounted for by Bitcoin, used to identify 'Altcoin Seasons'.
Verified by CryptoLV Alpha
Concept Diagram
Key Takeaways
1
BTC Dominance tracks whether capital is concentrating in Bitcoin or flowing into higher-risk altcoins.
2
BTC up + Dom up = healthy bull start. BTC sideways + Dom down = Altcoin Season sweet spot.
3
BTC down + Dom up = panic phase where altcoins bleed faster than Bitcoin.
4
Tracking dominance allows traders to time entries into smaller assets with higher statistical accuracy.
Practical Example
BTC dominance drops from 55% to 40% while BTC price stays flat. This signals capital rotating into ETH, SOL, and mid-caps. A trader shifting portfolio weight to altcoins during this phase captures 3-5x higher returns.
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Related Terms
Blockchain
Market CapThe total market value of a cryptocurrency's circulating supply (Price x Circulating Supply).
Strategy
DXY (US Dollar Index)An index measuring the value of the US Dollar against a basket of world currencies. In crypto, it inversely correlates with BTC.
Macro
Risk-On / Risk-OffA market paradigm where investors either flock to high-yield risk assets (Risk-On) or seek safety in cash/gold/bonds (Risk-Off).
Strategy
Bear MarketA sustained period of falling asset prices, typically characterized by negative investor sentiment and high volatility.
Strategy
Bull MarketA sustained period of rising asset prices, often driven by high demand, institutional adoption, and positive macro conditions.
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