Decline in Bitcoin Dominance: The Classic Precursor to Altcoin Market Leadership
The most notable shift this week has been the sustained drop in the Bitcoin Dominance Index—down 6.9% from its local high. According to Bitfinex analysts, “A decline in BTC dominance without a sharp price correction typically marks the transition into an altcoin-led cycle within a bull market.” This assessment is backed by Coinglass’ Altseason Index, which surpassed 50 for the first time since December—further evidence of increased capital flow into the altcoin sector.
Altseason index: signal for capital shift. Source: CoinglassRecord Inflows to ETH-ETF and Soaring Open Interest in Derivatives
The altcoin rally has been driven in large part by historic inflows into U.S. spot Ethereum ETFs, which attracted $2.18 billion last week alone—more than double the previous record of $908 million, according to SoSoValue. In tandem, open interest in ETH futures exploded from $40 billion to $57 billion in just seven days (Coinglass), underscoring the surge of optimism among derivatives traders.
Momentum has further accelerated following President Donald Trump’s signing of the GENIUS Act last week, fresh off a successful “Crypto Week” in Congress. This landmark legislation is expected to catalyze the growth of blockchains hosting stablecoins and could deliver a major boost to top L1 assets—ETH, SOL, XRP, and ADA. QCP analysts also highlight a growing trend: public companies are increasingly adding ETH, SOL, and XRP to their corporate treasuries, mirroring the long-term accumulation strategy once unique to BTC.
Altseason Outlook: Are We on the Verge of a Full-Fledged Rally?
Should the current trend among leading altcoins persist—and if the SEC moves to approve staking in spot Ethereum ETFs—the market could see a powerful new catalyst for a full-scale altseason. In this environment, Bitcoin remains under relative pressure as institutional capital shifts toward a broader array of blockchain solutions. This pivot signals an increasingly mature market, with investors now actively diversifying portfolios in favor of high-conviction altcoins.