A well-known cryptocurrency analyst has expressed skepticism about Bitcoin’s market dominance returning to the highs it reached in December 2020, a time when Bitcoin’s value skyrocketed by approximately 220% over the course of three months.
Benjamin Cowen, the founder of Into The Cryptoverse, shared his insights during an interview with The David Lin Report on August 17. Cowen stated, “I don’t think it is going back up to 70%, my target for Bitcoin dominance has been 60%.”
Analyst Predicts Bitcoin Dominance Will Cap at 60%
Cowen elaborated on the patterns observed in the cryptocurrency market, particularly how Bitcoin’s dominance tends to decrease during major “altcoin seasons,” such as the one experienced in 2021. This dominance refers to the percentage of Bitcoin’s market capitalization relative to the entire cryptocurrency market. Typically, Bitcoin’s dominance drops during these altcoin surges but eventually recovers some of the lost ground. However, in this current cycle, Cowen believes that even if Bitcoin’s dominance increases, it is unlikely to reach the levels seen in the past.
“I think there is room for Ethereum and many other cryptocurrencies,” Cowen noted, emphasizing the growing significance of other digital assets in the market.
Cowen expects Bitcoin’s dominance to make a final push towards 60% sometime between September and December. Currently, Bitcoin’s dominance stands at 57.36%, reflecting a 4.25% increase since July 18, based on TradingView data.
On the other hand, a pseudonymous crypto trader known as Kaleo, who has a following of 643,700 on X (formerly Twitter), recently suggested that Bitcoin dominance may have already peaked. Kaleo shared their views on August 9, when Bitcoin dominance was around 57.50%, stating, “I feel fairly confident this is the cycle top for Bitcoin Dominance.”
Kaleo admitted that they had anticipated a peak closer to 60% but were relieved that it didn’t reach that level, noting that a higher dominance could have signaled more pain for altcoins. Kaleo believes that “the real” altcoin season will begin once Bitcoin dominance dips below 50%.
Investors and traders often monitor Bitcoin’s dominance as a key indicator, using it to gauge the optimal time to shift their investments from Bitcoin to alternative cryptocurrencies, or altcoins.
Altcoin Season and Stablecoins Impact Bitcoin’s Market Share
Back in December 2020, Bitcoin’s dominance reached a high of 70.23% before its price surged to $61,283 in March 2021, according to CoinMarketCap data. However, Cowen observed that the current market conditions in 2024 present new challenges, making it “trickier” to assess Bitcoin’s dominance. He pointed out that in 2019, Bitcoin dominance peaked at slightly above 71%, but the market capitalization of stablecoins, like Tether (USDT), was significantly lower at that time.
Cowen suggested that investors should consider combining Bitcoin dominance with the dominance of stablecoins like USDT to get a better sense of the market’s “flight to safety” sentiment. During his August 17 interview, he mentioned that the combined dominance of Bitcoin and Tether is currently around 63%, a level similar to what was observed in June 2019, just before the U.S. Federal Reserve decided to cut interest rates.
As of now, the combined market dominance of Bitcoin and USDT stands at 63.07%.