Bitcoin Dominance Signals Shift Towards Altcoins Ahead of 2025 Altseason
- Bitcoin dominance is forming a macro reversal pattern as investors shift focus to altcoins, anticipating a major altseason.
The cryptocurrency industry, led by Bitcoin (BTC), began 2025 positively after concluding 2024 with a bullish outlook. The re-election of President-elect Donald Trump and other pro-crypto US leaders significantly impacted the web3 industry and digital assets.
Long-term confidence in cryptocurrency has risen sharply, evidenced by notable cash inflows into crypto investment products. Institutional investors, including BlackRock and MicroStrategy Inc. (NASDAQ: MSTR), have increased their investments in the sector.
Crypto assets are recognized as an effective hedge against inflation amidst global fiat devaluation. Additionally, clearer regulations worldwide, particularly Europe's MiCA, have established new standards for the web3 industry.
Reasons for an Upcoming Altseason
The next phase of the 2024/2025 crypto bull run is expected to be dominated by mid and small-cap altcoins with active online communities. Bitcoin dominance, a key indicator of cash rotation within crypto, indicates a trend reversal after a two-year upward trend.
From a technical analysis perspective, the TOTAL3 market cap, excluding Bitcoin and Ethereum, has recently broken out of a declining logarithmic trend.
While potential corrections may lead to further long liquidations short-term, the overall long-term outlook remains bullish.
Top Altcoins to Consider Ahead
The altcoin market presents significant profit opportunities in the coming months. Bitcoin's price has seen substantial growth over the past two years, revealing diminishing returns.
The memecoins sector, led by Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE), is projected to gain more during the upcoming altseason. Currently, the memecoin market is valued at over $115 billion, with a 24-hour average trading volume exceeding $13 billion.
As institutional interest in digital assets grows, traders should consider Artificial Intelligence (AI) coins and projects centered on Decentralized Physical Infrastructure Networks (DePIN). AI coins currently have a market capitalization of approximately $49 billion and a daily trading volume of $4.5 billion. The DePIN sector holds a market cap of about $34 billion with an average daily volume around $2.2 billion.