The crypto world is buzzing. Bitcoin recently broke through the $40,000 mark—a psychological and technical milestone—sparking widespread speculation: Is the bull market back?
After a brutal bear market that followed Bitcoin’s all-time high of nearly $69,000 on November 10, 2021, many assets in the space lost over 90% of their value. For nearly two years, pessimism ruled. But 2023 marked a shift. Bitcoin led the charge upward, gaining momentum even before key catalysts like the Bitcoin halving or the approval of a spot Bitcoin ETF—events widely expected in early 2024—had materialized.
So why is Bitcoin rising now? And more importantly, what should investors do next?
Understanding Bitcoin Dominance: A Strategic Market Indicator
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One of the most insightful metrics for gauging the phase of a crypto cycle is Bitcoin dominance (BTC.D)—the percentage of Bitcoin’s market capitalization relative to the total crypto market cap.
You can track this metric on platforms like CoinMarketCap or CoinGecko, both offering historical charts spanning several years.
What Does Bitcoin Dominance Tell Us?
- High BTC.D (e.g., above 50%): Indicates a market where Bitcoin is outperforming altcoins. Often seen at the start of a bull run or during risk-off sentiment.
- Declining BTC.D: Signals capital rotation into altcoins—a potential sign of an emerging "altcoin season."
Before 2017, Bitcoin dominance was consistently above 80%, simply because few alternatives existed. The rise of Ethereum and the ICO boom introduced thousands of new projects, fragmenting market share and creating distinct investment sectors within crypto.
Historically, during major bull markets (2017 and 2021), Bitcoin dominance dropped below 40% as investors chased higher returns in smaller-cap altcoins. This phase is commonly known as altcoin season.
Altcoin season: A period in the crypto cycle when altcoins significantly outperform Bitcoin, often marked by double-, triple-, or even hundred-fold gains.
These cycles suggest a recurring pattern: Bitcoin leads the recovery, then altcoins catch fire later.
The Market传导 Effect: How Bull Runs Typically Unfold
Crypto bull markets don’t ignite all at once. They follow a recognizable market传导 (market transmission) sequence, similar to stages in traditional equity bull runs:
- Bitcoin rallies first – As the largest and most liquid asset, it attracts early capital.
- Ethereum and blue-chip altcoins follow – Projects like ETH, SOL, ADA gain traction as confidence builds.
- Mid- and small-cap altcoins surge – Speculative capital floods into niche sectors.
- "Last uptrend coins" peak – Low-cap, high-risk tokens explode—often signaling market exhaustion.
This cycle repeats across multiple mini-waves within a broader bull trend. Each wave may be driven by different narratives.
Current Narrative Drivers in 2025
Despite the halving and spot ETF approvals still pending (expected in early 2024), momentum has already begun. Why?
Because narratives shape markets before fundamentals fully align.
Key themes fueling this early move:
- Bitcoin halving anticipation
- Spot ETF speculation
- RWA (Real World Assets) tokenization
- Ordinals and BRC-20 tokens
The Ordinals protocol, which enables NFT-like inscriptions on Bitcoin, has reignited interest in the network’s utility. What started on Bitcoin has spilled over to other chains like Solana and BNB Chain, creating explosive growth in niche ecosystems.
This shows that even without full macro catalysts, innovation can drive capital flows.
So, Is the Bull Market Here?
Based on Bitcoin dominance trends, we may be in the early stage of a Bitcoin-led rally, but not yet in a full-blown altcoin-dominated bull market.
Here’s how to interpret current signals:
- Bitcoin dominance is rising → Money is flowing into BTC, not broadly across altcoins.
- Ethereum dominance is flat or slightly down → No strong rotation into major altcoins yet.
- No widespread altcoin breakout → The "altcoin season" hasn’t started.
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In short: Bitcoin's bull market may have begun. The broader crypto bull run likely has not.
How Should You Position Yourself?
Whether you believe the bull market is confirmed or still forming, strategic preparation matters more than perfect timing.
Scenario 1: Early-Stage Bull Market (Most Likely)
If Bitcoin is leading and dominance remains high, expect a gradual传导 effect:
- Next phase: Ethereum and large-cap altcoins (e.g., SOL, DOT, AVAX)
- Followed by mid-caps and thematic plays (DeFi, AI, RWA)
- Finally, speculative small caps
Action plan: Build positions in blue-chip altcoins while maintaining core BTC exposure.
Scenario 2: False Start or Isolated BTC Rally
If macro conditions sour or ETF delays occur, Bitcoin could retest lower levels.
Action plan: Use dollar-cost averaging (DCA) to accumulate high-conviction assets without timing the bottom.
Common Investment Challenges & Practical Solutions
Crypto investing is hard—even for experienced traders. Here are three universal hurdles and how to overcome them:
❌ Challenge 1: Timing the Market
No one consistently predicts tops and bottoms.
✅ Solution: Use DCA (Dollar-Cost Averaging) or regular fixed investments to reduce timing risk.
❌ Challenge 2: Picking Winning Projects
With thousands of tokens, choosing the right ones feels overwhelming.
✅ Solution: Consider passive market-wide exposure via diversified portfolios or index-like strategies (e.g., self-built crypto ETFs).
❌ Challenge 3: Limited Capital
Small accounts struggle to diversify or withstand volatility.
✅ Solution: Allocate larger portions to stable, liquid blue-chips (BTC, ETH), use modest leverage carefully, and avoid FOMO-driven small-cap bets.
FAQ: Your Burning Questions Answered
Q: What is a healthy Bitcoin dominance level?
A: There’s no fixed “healthy” number. Historically, above 50% suggests Bitcoin strength; below 40% often signals altcoin season. Watch for trends rather than absolute values.
Q: How do I know when altcoin season starts?
A: Look for sustained drops in BTC.D combined with strong volume and price action in mid-cap altcoins. Tools like the Altcoin Season Index can help visualize this shift.
Q: Should I sell Bitcoin to buy altcoins now?
A: Not necessarily. Rotate gradually. Maintain core BTC/ETH holdings and allocate surplus to altcoins as momentum builds.
Q: Does Bitcoin dominance always drop in a bull market?
A: Generally yes—but not immediately. It often peaks early before declining as speculation spreads across the market.
Q: Can the bull run fail if ETFs are rejected?
A: Possible, but unlikely to kill momentum entirely. ETF delays may cause pullbacks, but structural demand (halving, institutional adoption) supports long-term upside.
Q: What’s the best strategy if I missed the early BTC move?
A: Focus on relative opportunities. Late-cycle gains often come from altcoins. Use BTC.D trends to time sector rotations instead of chasing BTC at highs.
Final Thoughts: Focus on Action, Not Prediction
Trying to perfectly time the market is futile. Even experts get it wrong. What matters is having a flexible strategy ready for multiple outcomes.
Instead of asking “Has the bull market arrived?”, ask:
- Am I positioned for growth if it does?
- Can I manage risk if it doesn’t?
- Are my holdings aligned with long-term conviction?
Crypto remains a young asset class—only about seven years removed from the ICO explosion, with just two full cycles to study. Historical patterns help, but adaptability is key.
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Whether you're building a diversified portfolio, DCA-ing into Bitcoin, or exploring high-potential niches like RWA or Bitcoin L2s, now is the time to act—not wait for certainty that may never come.
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