Bitcoin is still running the show in the crypto market and that could be the main reason the long-anticipated altseason hasn’t arrived yet.
A new quarterly report from Bybit and Block Scholes, released on August 8, shows Bitcoin’s share of the total non-stablecoin market cap is continuing to climb. That’s a break from the usual post-halving pattern, where BTC dominance peaks and then quickly drops as capital rotates into altcoins.
In previous cycles, this shift happened roughly 230 days after the halving. This time around, that milestone passed in December 2024 without the sharp drop in dominance that typically signals the start of altseason.
🔍 What’s Different This Cycle?
Traditionally, the market cycle went like this:
- Bitcoin rallies to new highs.
- Investors take profits.
- They rotate into Ethereum and smaller altcoins, sparking big rallies across the board.
But in this cycle, Bitcoin has hit multiple record highs without triggering that same flood of capital into altcoins.
The report points to a major reason: the rise of institutional investors. Corporate treasuries, pension funds, and other large players are buying and holding Bitcoin through spot ETFs and direct custody. These “sticky” investors tend to hold long term, meaning less volatility and fewer funds flowing into altcoins.
With Bitcoin up about 79% over the past year (compared to the S&P 500’s 16%), there’s less incentive for these investors to take on the higher risk of chasing smaller coins.
💡 Ethereum’s Waiting Game
Ethereum has shown some signs of leadership. Since April, ETH is up nearly 100%, compared to BTC’s 40%. Gains have been fueled by:
- The May Pectra upgrade
- Clearer U.S. rules for staking
- Strong inflows into ETH spot ETFs at times even outpacing BTC ETF inflows in July
Still, ETH’s strength hasn’t been enough to spark a broader drop in BTC dominance. The report suggests that a rotation could happen if more institutional flows shift from BTC ETFs to ETH ETFs. U.S. moves toward tokenization and the launch of staking-enabled ETFs could also be catalysts.
📊 Sentiment Check
Right now, derivatives markets show bullish sentiment in both BTC and ETH but not the “euphoric” positioning that has historically come before major altcoin rallies. Until Bitcoin dominance takes a decisive dip, the next altseason looks more like a possibility than a sure thing.
Bottom Line: Bitcoin’s institutional-backed rise is keeping capital locked up in BTC. Unless that changes, altcoins may have to wait a while longer for their time in the spotlight.
