In brief
- Bitcoin’s dominance fell to 57.8% of the crypto market.
- XRP and Dogecoin led gains among altcoins.
- Altcoin season could happen, but it probably won’t hit the same way, according to Hashdex’s Gerry O’Shea.
XRP and Dogecoin led altcoins higher on Friday as Bitcoin’s dominance fell to a 12-day low.
The Ripple-linked token was recently changing hands around $3.29, a 7.5% jump over the past day, according to crypto data provider CoinGecko. Dogecoin meanwhile jumped 6.2% to $0.22, while Ethereum’s price eclipsed the $4,000 mark for the first time since December.
Bitcoin’s market cap accounted for 57.8% of the crypto market on Friday, down from 61.3% a week ago, according to CoinGecko. Within the past three months, Bitcoin has accounted for as much as 65% of the $3.9 trillion crypto sector—and as little as 57.07%.
With each market cycle in Bitcoin’s existence, altcoins have experienced a sustained period of outperformance after asset’s price peaked, often referred to as an altcoin season.
That could happen again, but it likely not to the same degree, Gerry O’Shea, head of global markets insights at crypto asset manager Hashdex, told Decrypt, pointing to structural market changes as a result of exchange-traded funds in the U.S. and corporate buying.
“You have these institutional buyers that are kind of backstopping it at this point,” he said. “That’s not to suggest that we’re not going to see a fair amount of volatility with Bitcoin going forward, but I do think it’s going to be a lot different than what we’ve seen in previous cycles.”
Previous altcoins seasons have been marked by speculative investments like NFTs, meme coins, or ICOs, but O’Shea said investors could gravitate with projects that put utility front and center because of regulatory progress in the U.S. and the passage of stablecoin legislation.
“Ethereum [and] Solana, the smart contract platforms that provide infrastructure for stablecoins, are obviously demonstrating utility here,” he said. “I think that could certainly be contributing to Bitcoin’s falling dominance.”
On Friday, the leading cryptocurrency by market capitalization hovered around $116,000, a 0.1% increase over the past day. And its price was up 96% over the past year. In a Myriad Linea Markets prediction table, nearly two in three participants predict that Ethereum will reach $5,000 by year’s end.
(Disclosure: Myriad is a prediction market and engagement platform developed by Dastan, parent company of an editorially independent Decrypt.)
The Bitcoin market, in recent weeks, has proved resilient. The asset’s price dipped as low as $112,000 last month, despite institutional crypto firm Galaxy Digital executing a $9 billion Bitcoin sale on behalf of a single, Satoshi-era investor.
During the company’s second-quarter earnings call, Galaxy CEO Mike Novogratz remarked with relief that the sale just happened to take place as Bitcoin-buying firms like Strategy, formerly MicroStrategy, were hoovering up the asset.
Bitcoin’s falling dominance “may persist for a while,” but ultimately, “the tailwinds for Bitcoin just remain incredibly strong, mostly because of the institutional adoption of the asset,” O’Shea said.
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