Bitcoin's dominance rate has plateaued, suggesting that alternative tokens (altcoins) may outperform it in the near future. After rising from 42% to 48% in Q1, the metric has struggled to surpass that level this month, oscillating between 38% and 48% for almost two years. Historically, declines in the dominance rate from 46%-48% have coincided with outsized gains in altcoins. Markus Thielen, head of research and strategy at Matrixport, believes that altcoins could outperform Bitcoin if its dominance rate peaks out. The total market cap of altcoins rose by more than 60% to $1.39 trillion in two months after the BTC dominance rate turned lower from 48% in July 2021. Thielen suggests that for Bitcoin to continue outperforming the rest of the ecosystem would imply that only Bitcoin matters, which is unlikely given the intellectual and financial firepower being deployed on other chains.
(By Omkar Godbole)
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