The Bitcoin Dominance Mystery I Had to Solve
I’ve been tracking Bitcoin dominance for years now. Something weird happened recently that confused me deeply. Bitcoin dominance stopped rising even though altcoins kept bleeding.

That didn’t make sense at first glance. But when I dug deeper, I found something fascinating. The truth about Bitcoin dominance shocked even me. Let me share what I discovered about this metric.

What Bitcoin Dominance Really Tells Us
Bitcoin dominance measures Bitcoin’s market share versus all cryptocurrencies. Most traders watch this metric religiously every day. They believe it shows Bitcoin versus altcoin strength. But that’s only part of the story now. I learned this lesson the hard way myself.

For years, I said Bitcoin was better than altcoins. Bitcoin dominance was in a clear macro uptrend. That made the investment case crystal clear then.

The Pattern Everyone Missed
People assumed Bitcoin dominance peaking meant altseason was coming. I pushed back against this assumption repeatedly, though. History showed us a different story entirely here. In 2019, altcoins hit range lows against Bitcoin. Bitcoin then entered a bear market right after. Why would this cycle be any different, really?

What Bitcoin Dominance Really Tells Us

The Stablecoin Factor Changes Everything
Here’s where things get really interesting for us. Bitcoin dominance, including stablecoins, sits around 58% currently. But excluding stablecoins, it’s actually at 67% now. That’s a massive 9% difference between the two. This gap explains the confusion we’re all seeing.

Stablecoin dominance has been spiking since September significantly. USDT and USDC dominance keep climbing higher together.

Why This Matters for Your Portfolio
Let me break down what’s actually happening here. Most individual altcoins are bleeding against Bitcoin badly. Ethereum has been dropping since September against Bitcoin.

Solana shows the same bearish pattern too clearly. BNB is also down against Bitcoin since then. Yet Bitcoin dominance appears flat when including stables. The flight to safety never actually went away. Money is flowing into stablecoins, not altcoins, really.

The Historical Pattern I’m Watching Closely
The Historical Pattern I’m Watching Closely... I spotted an “unfortunate pattern” a few months ago. Stablecoins showed a double high formation, breaking through. Bitcoin dominance showed this exact same pattern previously.

It made a high, another high, then broke. One final pullback happened before the durable breakout. Stablecoin dominance is following this playbook perfectly now.

What Happened When Bitcoin Hit 97K
I published a macro memo when Bitcoin rallied. The market didn’t show signs of health then. It looked like a distribution phase to me. Smart money was rotating into safer assets quietly. Stablecoins became the true safe haven here. This confirmed my concerns about market structure significantly.

Understanding the Fed’s Role in This
Interest rates play a huge role here, too. Last cycle, altcoins rallied after quantitative tightening ended. But the Fed funds rate was lower then. Relative to neutral rates, conditions were more favorable. This cycle presents different circumstances for us, though. The Fed funds rate remains relatively high still. It hasn’t dropped enough to justify altcoin rallies.

The Two-Year Yield Tells the Story
I compare the Fed funds rate to two-year yields. This approximates the neutral rate for the economy. Last cycle, rates dropped below this level quickly. We haven’t seen that happen yet this time. This might explain why Bitcoin dominance keeps rising. The macro environment doesn’t support altcoin rotation yet.

Where Bitcoin Dominance Is Headed Next
Where Bitcoin Dominance Is Headed Next... I believe Bitcoin dominance will sweep the highs. It might not happen during this bear market. But the next bull market should drive it. Excluding stablecoins, dominance is at May 2025 levels. Including stablecoins, it appears much weaker superficially, though. This creates confusion among traders watching these charts.

The Bear Market Reality Check
Bitcoin reached the end of its four-year cycle. It entered a bear market like clockwork again. Traders who’ve been through this know the pattern. Bitcoin historically tops in Q4 post-halving years, typically. Midterm years aren’t great for holding Bitcoin either. Many veterans rotated into stablecoins for safety here.

My Take on What Comes Next
Altcoins are oscillators at best against Bitcoin historically. They’ll have phases where they outperform briefly sometimes. But the macro uptrend for Bitcoin dominance remains. Excluding stables, we’re seeing higher lows consistently still. I expect we’ll retest recent lows eventually, though. We might even go below those lows temporarily.

The Phase Most People Get Wrong
Many traders think we’re at the altseason point. I believe we’re actually much earlier than that. We’re in the accumulation phase, still really here. The real rotation comes when conditions align better. Lower interest rates and quantitative easing help immensely. We haven’t reached that macro environment yet, clearly.

My Personal Strategy Going Forward
My Personal Strategy Going Forward... I’m watching stablecoin dominance very closely now, daily. Whenthe USDT market cap starts dropping significantly more. That becomes a tailwind for Bitcoin dominance, finally. We’re seeing early signs of this happening. USDT market cap dropped similarly in 2022. It’s starting to drop again in 2026 now. Money will eventually flow back into Bitcoin strongly. Then later into altcoins when the timing is right.

Key Lessons I Learned from This
Bitcoin dominance is more nuanced than people realize. You can’t just look at one metric. You need to understand what’s happening beneath. Stablecoins mask the true Bitcoin versus altcoin dynamic. Excluding stables gives you the real picture clearly. The macro environment dictates when rotations truly happen. Don’t fight the Fed and don’t fight.

What This Means for You Today
If you’re holding altcoins, understand the reality here. They’ve been struggling for years against Bitcoin badly. The bleeding hasn’t stopped just because dominance flatlined. Stablecoins are absorbing money that could flow. Be patient and wait for better conditions. The next bull market will present opportunities. But we’re not there yet in this cycle.

Final Thoughts
Understanding Bitcoin dominance changed my entire investment approach completely. I stopped looking at surface-level metrics only now. I dig deeper into what’s driving movements. Stablecoins revealed the truth about market flows.

This knowledge helps me make better decisions daily. I hope this breakdown helps you too similarly. Stay safe out there in these markets.