Bitcoin’s dominance – its share of the total crypto market – has plunged by 5.8% in just a week to under 61%, its steepest decline since June 2022. Meanwhile, the overall crypto market cap has surged from $3 trillion to $3.8 trillion, fueled by altcoins like Ethereum (ETH) as Bitcoin’s rally stalls below $120,000.
Notably, Bitcoin’s correlation with altcoins is weakening fast, with some even moving inversely. Historically, this signals rising volatility and potential liquidations of leveraged trades, according to Alphractal.
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Why the shift?
As Bitcoin’s price hits record highs, new investors are turning to cheaper altcoins, mistaking low per-unit prices for higher growth potential. This “unit bias” is driving money into tokens like DOGE and XRP, further eroding Bitcoin’s dominance.
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