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BTC

Why Bitcoin Dominance Often Rises During Crypto Dumps

I see Bitcoin dominance rise during market dumps because dominance is a ratio, not an absolute measure — if the total crypto market cap falls faster than Bitcoin's market cap, dominance goes up even if BTC is falling.

Altcoins typically lose value faster and have thinner liquidity, so during sell-offs traders either rotate into BTC or into stablecoins, shrinking the denominator and boosting BTC's share. Also many alt trades are against BTC, so selling alts often converts into BTC rather than fiat, propping up BTC relative to the rest.

I treat dominance spikes in dumps as a risk-off signal rather than a clear bullish signal for Bitcoin's price: it shows relative safety or liquidity concentration, not necessarily immediate upside for BTC.

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Analysis

Dominance = BTC market cap / total crypto market cap. In crashes, smaller-cap altcoins typically suffer larger percentage losses and liquidity dries up; many traders sell alts into BTC or stablecoins,...

Recommendation

I recommend watching dominance as a risk-off indicator and monitoring stablecoin flows, BTC pair volumes and altcoin liquidity before trading — don’t assume a dominance spike during a dump means BTC w...

Disclaimer

The Analysis and recommendations provided are for informational purposes only. Any investment decisions should be made at your own risk. Past performance is not indicative of future results. Always conduct your own research and consider consulting with a financial advisor before making any investment decisions.

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