BTC Dominance at New Highs – Here’s What Ben Cowen Thinks Will Happen Next

Bitcoin’s (BTC) dominance level has reached a new yearly high, sitting at approximately 57.5% – beating out its previous peak in June earlier this year. In a video released yesterday, esteemed crypto analyst Ben Cowen believes that the rising figures bode poorly for the altcoin market. As liquidity leaves the cryptoverse – to be expected during any prolonged downturn – money naturally moves away from riskier assets (altcoins) and into lower-risk ones like Bitcoin. 

So when short-term Bitcoin price rallies – like we often see in a bear market – inevitably correct, altcoins may end up bleeding 20%+ in value. Cowen even suggested that Ethereum (ETH), often considered a blue-chip crypto digital asset, may not be immune from the potential damage to altcoins.

What Is Bitcoin Dominance and What Does It Mean?

Bitcoin dominance measures how much of crypto’s total market cap is comprised of circulating BTC. For example, if BTC dominance is at 50%, and the crypto market cap is at $1 trillion, it means that Bitcoin’s total market cap would equal $500 billion. Generally speaking, rising Bitcoin dominance is indicative of a slow market and spells bad news for altcoins. 

A recent article from Coindesk supported Ben Cowen’s theory, with fellow analyst Katie Stockton stating that “the [BTC dominance] index is poised to extend higher… our long-term trend-following indicators also support more bitcoin dominance…we expect bitcoin to outperform altcoins.”

Bitcoin’s Odd Fortnight

It’s been an interesting few weeks for Bitcoin, to say the least. First, investors tested (and were rejected) at the US $27k ($42.8k) barrier, with the coin falling to its lowest point since September. But then, a misleading tweet from Cointelegraph – suggesting a spot ETF approval was imminent – caused a flurry of activity. The price of BTC rocketed to US $30k ($47.6k), before falling back to US $28k ($44.4k) where it has consolidated over the past couple of days. 

All in all, it’s been a great year for BTC with the coin up 46% since October 2022. If Cowen and Stockton are correct, Bitcoin’s dominance will carry on rising while the altcoin market continues to lose value for the foreseeable future.