The cryptocurrency market is witnessing a notable change. Bitcoin (BTC) recorded a new all-time high (ATH) in July 2025. However, simultaneously, the Bitcoin dominance index (BTC.D) has dropped from 66% to 64.5%.
This decline provides optimistic reasons for altcoin investors. The total market capitalization of altcoins is now growing faster than Bitcoin.
Rising Altcoin Market Cap... Predicting Altcoin Season
According to TradingView data, the altcoin market capitalization (TOTAL2) has recovered almost 10% since early July. It recently surpassed $1.2 trillion.
Meanwhile, Bitcoin dominance has fallen from 66% to 64.5%, which is the largest decline since May.
Notably, when Bitcoin recorded a new ATH of over $111,000 on July 9th, BTC.D continued to decline. This suggests that altcoins are gaining market capitalization faster than Bitcoin, presenting a rare opportunity for altcoin investors.
Additionally, anonymous cryptocurrency analyst Master of Crypto stated that an altcoin season could begin without Bitcoin falling. Instead, if BTC's price remains stable while dominance continues to drop, it could create perfect conditions for altcoins, especially low to mid-cap tokens, to rise.
He also pointed out that the intensity of the altcoin season depends on how deeply BTC.D falls at the EMA50 and EMA200 levels.
"If BTC.D falls below the 50-day EMA → You can see a mini altcoin season (low/mid-cap rise). If it breaks through the 200-day EMA → Prepare for a major altcoin season (ETH, SOL, meme coin surge)," Master of Crypto predicted.
Increase in Exchange Stablecoins... Investors Holding 'Dry Powder'
Another key factor is the large amount of stablecoins held on exchanges, often referred to as "dry powder" ready to ignite the market.
According to CryptoQuant analyst Oinonen_t, Binance's USDT and USDC reserves have been consistently high, exceeding a total value of $31 billion. Meanwhile, exchanges' Bitcoin reserves are decreasing.
These two factors indicate that investors are preparing for an altcoin season.
"What lies behind the separation of stablecoins and Bitcoin reserves? First, during an upward cycle, Bitcoin units are typically withdrawn from exchanges to personal wallets and stored in cold wallets long-term. In contrast, increasing stablecoin reserves reflect unused 'dry powder'," Oinonen_t explained.
However, repeated altcoin season predictions over the past few years have become like the "boy who cried wolf", making investors skeptical and cautious.
A recent BeInCrypto report also pointed out growing doubts among retail investors. However, famous market analyst Michael van de Poppe believes skepticism is a natural part of the upward cycle.
