- Ethereum’s ongoing weakness against Bitcoin continues to delay altcoin season, raising market uncertainty
- Bitcoin’s dominance has been climbing too, limiting altcoin rallies
The much-anticipated altcoin season may remain on hold unless Ethereum’s [ETH] price relative to Bitcoin [BTC] stages a strong reversal. In fact, market experts argue that Bitcoin’s dominance plays a critical role in determining the strength of altcoin rallies. And, with BTC’s dominance rising, the outlook for altcoins remains uncertain.
While historical patterns suggest altseasons often follows high phases of dominance, ETH/BTC’s sustained downtrend leaves traders questioning when – if at all – the tide will turn this cycle.
Altcoin season hinges on ETH/BTC reversal
Ethereum’s underperformance against Bitcoin continues to challenge expectations of a broad altcoin rally. According to market analyst Benjamin Cowen, for instance, until ETH/BTC finds a stable bottom and starts trending higher, capital rotation into altcoins will remain weak.
Source: X
The latest ETH/BTC monthly chart underlined a sharp decline, with the pair breaking below key historical support levels. Trading at 0.0279 at press time, ETH/BTC dropped by 13.28% this month, extending its multi-year downtrend that began in late 2021.
The data highlighted a clear macro downtrend, resembling previous bear cycles where Ethereum struggled against Bitcoin’s dominance.
Historically, strong ETH/BTC recoveries have preceded major altcoin rallies. However, with Ethereum weakening relative to Bitcoin, altcoins face significant headwinds. Unless ETH/BTC stabilizes and reverses itself, Bitcoin is likely to maintain its dominance over the market.
Bitcoin dominance and its impact on altcoins
Bitcoin dominance [BTC.D] has been on an upward trajectory lately, with the same reaching 60.65% and reinforcing its stronghold over the crypto market.
This trend is a sign of investors’ preference for Bitcoin over riskier assets. This can be further confirmed by Ethereum’s continued weakness.
Source: TradingView
A common misconception, as Cowen highlighted, is that rising BTC.D is inherently negative for crypto.
However, past cycles suggest that major altcoin rallies tend to emerge from periods of high BTC dominance, rather than low ones. Worth noting, however, that a meaningful shift in capital allocation remains unlikely until ETH/BTC notes a reversal.
Historical altseason delays and what’s next
Over the last three years, repeated calls for an altcoin season have failed to materialize as ETH/BTC continues its decline. According to Cowen, post-halving years typically see Bitcoin’s dominance decline, potentially setting the stage for altcoins later in the cycle.
However, for now, Bitcoin’s market structure remains the primary driver, and a definitive shift towards alts seems unlikely without a recovery in ETH/BTC.
While a reversal could still occur later this year, traders should remain cautious about premature optimism. Until Ethereum strengthens against Bitcoin, altseason remains a waiting game.
