I've noticed that many beginners get confused about one important metric—what BTC dominance is and why it even matters. Let’s break it down.

BTC dominance is essentially Bitcoin’s share of the total market capitalization of the cryptocurrency market. It’s straightforward: take Bitcoin’s market cap, divide it by the total market cap of all cryptocurrencies, and multiply by 100%. For example, if the entire crypto market is worth 2 trillion and BTC accounts for 1 trillion, then the dominance is 50%.

Why does this matter? Because dominance shows where the money is flowing. When what is BTC dominance rises, it means investors are moving capital into Bitcoin, and altcoins usually go dormant. When dominance falls, money starts moving into alts, and a real altseason may begin there.

Here’s a typical pattern: Bitcoin sharply moves up, and dominance jumps. Then BTC starts to move sideways, while altcoins suddenly come to life and dominance falls. After that, there’s a market crash—everyone looks for safety in BTC, and dominance rises again.

The mistake beginners make is thinking: BTC is rising, so altcoins must rise too. That’s wrong. First, check dominance, because it shows the real direction of capital and the timing for an altseason.

Based on current data, BTC dominance is around 57%. This is a pretty interesting point. If we remember that at the beginning of July dominance was at 65.5%, then we can see a significant shift now. Over these weeks, Ethereum and XRP have shown substantial growth, and that isn’t a coincidence.

What does this mean? BTC dominance is in a downtrend, signaling the start of an altseason. Investors are gradually moving funds from Bitcoin into altcoins. But the altseason index is still in the neutral zone, so a big alt rally isn’t clearly visible yet.

Dominance may continue to fall or correct back up. In any case, keeping an eye on this indicator is very useful if you want to understand what’s truly happening in the market—not just watch the prices of individual coins. On Gate, you can track BTC dominance in real time and use it for your trading.