A well-known analyst, Benjamin Cowen shared his skepticism about Bitcoin’s dominance ever returning to the levels we saw in late 2020.
He thinks that Bitcoin’s market dominance will peak at 60%, potentially as soon as September or by December.
Bitcoin dominance, the controversial metric
Cowen, the founder of Into The Cryptoverse, explained in an interview with The David Lin Report that while Bitcoin dominance typically decreases during altseasons, it often regains strength afterward.
But now he doubts it will reach the 70% level seen in December 2020, when Bitcoin’s price grew by about 220% in just three months.
“I don’t think we’re going back to 70%. My target for Bitcoin dominance has been 60%.”
He added that there’s enough space in the market for Ethereum and other cryptocurrencies, showing that Bitcoin’s dominance won’t rise as strong as in previous cycles.
At the time of writing, Bitcoin’s dominance stands at 57%, with an increase of 4% since mid-July.
Cowen believes Bitcoin will achieve its final move towards 60% dominance either by September or December of this year.
Bitcoin is the king, and not by coincidence
While Cowen is confident that Bitcoin’s dominance won’t return to previous highs, not everyone shares this view.
A pseudonymous crypto trader known as Kaleo suggested in the social media that Bitcoin dominance might have already reached its peak at around 57.50%.
Kaleo remarked, Bitcoin failing to hit 60% was a positive sign as it spared traders from more market pain.
Also worth to considering that a true altcoin season would begin when Bitcoin dominance falls below 50%, signaling a shift in investor focus from Bitcoin to other cryptocurrencies.
The new market dynamics
Comparing the 2024 market to 2019, Cowen told that Bitcoin dominance is more trickier to calculate now.
This is partly because the stablecoin market, which was much smaller in 2019, now plays a central role in the overall cryptocurrency ecosystem.
Back in December 2020, Bitcoin dominance reached 70.23% just before Bitcoin’s price reached $61,283 by March 2021.
Cowen thinks combining Bitcoin dominance metrics with the dominance of stablecoins like Tether to better understand market sentiment, a method he refers to as calculating flight to safety dominance.
He pointed out that the combined dominance figure right now stands at around 63%, a level last seen in June 2019, just before the U.S. Federal Reserve cut interest rates.
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