If you’ve spent time in crypto Twitter, you’ve probably heard traders obsessing over “Bitcoin dominance” (BTC Dom). But what does it actually mean, and why should you care? Let’s break it down without the jargon.
What Is Bitcoin Dominance?
Simple version: Bitcoin dominance is the percentage of Bitcoin’s market cap compared to the entire crypto market cap.
Example: If Bitcoin’s market cap is $1 trillion and the total crypto market is worth $2 trillion, then Bitcoin dominance = 50%.
That’s it. It’s basically measuring how much of the total crypto pie Bitcoin owns.
How Does It Work?
Every time Bitcoin’s price moves relative to other coins, the dominance ratio shifts:
BTC dominance rises → Bitcoin is gaining market share (investors rotating into BTC)
BTC dominance falls → Altcoins are pumping faster than Bitcoin (alt season vibes)
Four Scenarios When Dominance Rises
When BTC dominance climbs, it doesn’t always mean the same thing:
BTC mooning, alts stable → Investors are actively buying Bitcoin
Both rising, but BTC faster → Flight to safety within crypto
Both falling, but alts harder → Market crash, Bitcoin shows resilience
BTC stable, alts dumping → Fear, capital rotating to safety
The point: rising dominance = BTC is outperforming, but the why varies.
Four Scenarios When Dominance Falls
Similarly, falling dominance has multiple interpretations:
Alts pumping, BTC stable → Retail FOMO into “cheaper” coins
Both rising, alts faster → Alt season is real
Both falling, but BTC harder → BTC weakness (rare but happens)
BTC Dom drops below 40% → Extreme alt season. Bitcoin’s grip on the market loosens. This usually happens after massive bull runs when retail pours money into moonshot tokens.
BTC Dom rises above 50% → Bitcoin dominance. More than half the entire crypto market cap is in Bitcoin alone. This signals strength and typically happens after BTC recovers from crashes.
Bitcoin Halving & Dominance
Historically, Bitcoin halvings (which cut mining rewards in half) trigger huge volatility. Around halving events, dominance often spikes because:
Uncertainty sends capital to the “safest” asset (Bitcoin)
Media attention focuses on BTC
After the spike, alts often recover as hype fades
Bitcoin ETFs Changed the Game
When Bitcoin spot ETFs launched (especially in major markets), dominance initially surged because:
Institutional money flowed into the easiest vehicle (ETFs, not altcoins)
Retail investors who wanted crypto exposure chose ETFs over individual alts
Over time, this effect normalized, but BTC dominance stayed elevated
The lesson: major financial infrastructure changes can shift dominance patterns.
Does Lower Dominance = Higher Alt Prices?
Not necessarily. This is the trap most people fall into.
Imagine the total crypto market drops 50%, but alts drop 60% while Bitcoin drops 45%. Dominance rises even though everything is bleeding red.
Conversely, total market could be flat, alts could pump, dominance falls—but if there’s no new money flowing in, prices might not sustain.
The Real Truth: Dominance is a relative indicator, not absolute. It doesn’t guarantee profit. It just shows which asset is winning the game of musical chairs.
How to Use This Info
Falling dominance signals:
Risk appetite is increasing
Money is rotating from Bitcoin into alts
Potentially higher volatility ahead
Good time to scout altcoin setups (but also higher risk)
Rising dominance signals:
Risk-off sentiment
Capital flight to safety
Expect altcoins to underperform
Bitcoin showing strength
Bottom Line
Bitcoin dominance is just one piece of the puzzle. Don’t trade based on it alone—combine it with volume, on-chain metrics, and macro conditions. But understanding what dominance represents? That’s crucial context for reading the room.
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Dominance du Bitcoin expliquée : pourquoi ce métrique est plus important que vous ne le pensez
If you’ve spent time in crypto Twitter, you’ve probably heard traders obsessing over “Bitcoin dominance” (BTC Dom). But what does it actually mean, and why should you care? Let’s break it down without the jargon.
What Is Bitcoin Dominance?
Simple version: Bitcoin dominance is the percentage of Bitcoin’s market cap compared to the entire crypto market cap.
Example: If Bitcoin’s market cap is $1 trillion and the total crypto market is worth $2 trillion, then Bitcoin dominance = 50%.
That’s it. It’s basically measuring how much of the total crypto pie Bitcoin owns.
How Does It Work?
Every time Bitcoin’s price moves relative to other coins, the dominance ratio shifts:
Four Scenarios When Dominance Rises
When BTC dominance climbs, it doesn’t always mean the same thing:
The point: rising dominance = BTC is outperforming, but the why varies.
Four Scenarios When Dominance Falls
Similarly, falling dominance has multiple interpretations:
The Critical Thresholds
BTC Dom drops below 40% → Extreme alt season. Bitcoin’s grip on the market loosens. This usually happens after massive bull runs when retail pours money into moonshot tokens.
BTC Dom rises above 50% → Bitcoin dominance. More than half the entire crypto market cap is in Bitcoin alone. This signals strength and typically happens after BTC recovers from crashes.
Bitcoin Halving & Dominance
Historically, Bitcoin halvings (which cut mining rewards in half) trigger huge volatility. Around halving events, dominance often spikes because:
Bitcoin ETFs Changed the Game
When Bitcoin spot ETFs launched (especially in major markets), dominance initially surged because:
The lesson: major financial infrastructure changes can shift dominance patterns.
Does Lower Dominance = Higher Alt Prices?
Not necessarily. This is the trap most people fall into.
Imagine the total crypto market drops 50%, but alts drop 60% while Bitcoin drops 45%. Dominance rises even though everything is bleeding red.
Conversely, total market could be flat, alts could pump, dominance falls—but if there’s no new money flowing in, prices might not sustain.
The Real Truth: Dominance is a relative indicator, not absolute. It doesn’t guarantee profit. It just shows which asset is winning the game of musical chairs.
How to Use This Info
Falling dominance signals:
Rising dominance signals:
Bottom Line
Bitcoin dominance is just one piece of the puzzle. Don’t trade based on it alone—combine it with volume, on-chain metrics, and macro conditions. But understanding what dominance represents? That’s crucial context for reading the room.