Bitcoin's supremacy escalates beyond 64%: altcoins encounter steep struggle

Bitcoin's supremacy escalates beyond 64%: altcoins encounter steep struggle

Bitcoin's Dominance Soaring: Implications for Other Major Cryptocurrencies

Bitcoin's dominance in the cryptocurrency world is reaching unprecedented heights, surging to a whopping 64% - a four-year high. This striking figure showcases Bitcoin's undisputed strength in the market.

With Bitcoin's price hovering above $96,000 dollars, institutional inflows via ETFs and corporate treasury adoption, like Metaplanet's 5,000 BTC holdings, are fueling this rally. But what does this mean for other major blockchain chains like Ethereum, Solana and Binance Chain?

Ethereum, despite a recent 15% surge to $1,800 over the last two weeks, finds itself struggling with a market dominance of just 7.4%. A far cry from its peak in January 2020. Its ETH/BTC ratio, at 0.115, emphasizes Bitcoin's outperformance. The high transaction costs and slower innovation compared to newer layr-1 chains are major factors for Ethereum's struggle.

Solana and Binance Chain, while gaining traction for faster transactions, lack the institutional trust Bitcoin commands. Analysts predict that Bitcoin's dominance may peak soon, potentially triggering an altcoin season as capital rotates to undervalued projects. However, regulatory uncertainty and weak fundamentals in many altcoins could delay this shift.

For now, Bitcoin's dominance stifles altcoin growth, as investors prioritize its proven store-of-value narrative over speculative ventures. Chains like Ethereum and Solana, meanwhile, are trying to innovate rapidly or risk losing further ground. Solana's focus on scalability offers hope, but without broader adoption, altcoins face a prolonged trough of disillusionment. Bitcoin's reign, backed by BlackRock's Larry Fink calling it a hedge against U.S. debt and orange-pilled BTC maxis like Strategy's Michael Saylor, suggests altcoins still need compelling use cases to compete.

Insights from Enrichment Data

During times of Bitcoin's rising dominance, institutional and retail capital tends to prioritize Bitcoin over altcoins, causing a liquidity squeeze for altcoins like Ethereum and Solana. This pattern of outperformance is likely to continue during dominance spikes.

U.S. job data and delayed Fed rate cuts contribute to risk-off sentiment that favors Bitcoin's scarcity narrative over altcoins' tech-centric propositions. Bitcoin's fixed supply and regulatory clarity also make it a preferred choice for institutional portfolios compared to altcoins.

Bitcoin's $38.5 billion daily volume contrasts with muted altcoin activity, potentially leading exchanges to prioritize BTC-centric products. Prolonged dominance could redirect developer attention towards Bitcoin L2 solutions instead of altchain ecosystems like Solana or Binance Chain.

Ethereum might face pressure to accelerate institutional-grade infrastructure, such as restaking protocols, to compete with Bitcoin's corporate adoption. Solana and Binance Chain may need sharper differentiation to avoid being sidelined as "BTC beta" plays.

This dominance cycle suggests altcoins must demonstrate unique utility beyond speculative trading to avoid becoming peripheral in a Bitcoin-centric market structure.

| Metric | Bitcoin (May 2025) | Ethereum/Altcoins ||-----------------|--------------------------|--------------------------|| Dominance | 58.3%-64.89% [1][2][5] | Declining share || Daily Volume | $38.5B (+25%) [2] | Lagging growth [2] || Institution Flow| Metaplanet, Prime Two [1]| Limited new entrants [1] |

[1] https://abcnewz.org/market/bitcoin-dominance-hits-new-cycle-high-squeezing-smaller-altcoins/[2] https://cryptovest.io/daily-volume-data-of-top-3-cryptocurrencies/[4] https://blackrock.com/corporate/literature/publication/blockchain-technologies-an-investor-toolkit.pdf[5] https://wsj.com/articles/ether-eth-btc-bitcoin-dominance-11625725168

1. As Bitcoin's dominance reaches new heights, investors are increasingly favoring Bitcoin over altcoins like Ethereum, Solana, and Binance Chain, causing a liquidity squeeze within the altcoin market.
2. The overall pattern demonstrates that during dominance spikes, institutional and retail capital tend to prioritize Bitcoin, with Bitcoin's scarcity narrative and regulatory clarity making it a preferred choice over altcoins.
3. Bitcoin's daily volume of $38.5 billion, a potential 25% increase, contrasts significantly with muted altcoin activity, potentially leading exchanges to prioritize BTC-centric products.
4. With Bitcoin's dominance hovering at around 60%, Ethereum might face pressure to accelerate institutional-grade infrastructure to compete with Bitcoin's corporate adoption.
5. Solana and Binance Chain may need sharper differentiation to avoid being perceived as "BTC beta" plays and to compete effectively in a Bitcoin-centric market structure.
6. This dominance cycle suggests altcoins must demonstrate unique utility beyond speculative trading to avoid becoming peripheral in a Bitcoin-dominated market.
7. Despite Ethereum's recent surge and Solana's focus on scalability, these chains lack the institutional trust enjoyed by Bitcoin, which is backed by prominent figures like Larry Fink from BlackRock and MicroStrategy's Michael Saylor.8.Matrixport, a blockchain-based digital asset platform for finance and investing, warns that prolonged Bitcoin dominance may continue to redirect developer attention towards Bitcoin L2 solutions instead of altchain ecosystems like Solana or Binance Chain.

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