On November 17, 2020, Bitcoin (BTC) surpassed the $17,000 price zone, marking a new 2020 all-time high. Bitcoin's dominance index has risen steadily over recent months, reaching 65% this week. Despite Bitcoin's impressive rally, altcoins have not performed as well as they did three years ago when BTC was at similar levels.
Bitcoin Dominance Hits 65%
Back in December 2017, Bitcoin reached its previous all-time high of $19,600. At that time, Bitcoin dominance was notably lower, as numerous altcoins experienced massive gains. The dominance metric, which measures BTC's market cap against thousands of alternative cryptocurrencies, dipped to a low of 32% in January 2018. Today, at 65%, dominance has increased 103% since that January 2018 low.
As of November 17, Bitcoin's market capitalization stands at approximately $315 billion. Historical data shows that when Bitcoin was at $17,000 or higher in 2017, altcoins were performing far better than they are today. This trend has led many traders to conclude that the infamous 'altcoin season' has not yet begun—and some believe it never will.
Altcoins Lag Behind 2017 Prices
Specific examples illustrate the gap. On December 17, 2017, Ethereum (ETH) traded at $719. Despite a 256% gain in 2020, ETH is still 34% below that 2017 level. ETH's all-time high of $1,431 remains over 67% away. XRP traded at $0.72 on that day in 2017, and is currently 58% lower. XRP is down 92% from its ATH of $3.84.
Tether (USDT) has seen a staggering transformation. On December 17, 2017, USDT ranked 24th by market cap. Today, with a market capitalization of $17.9 billion, it is the third-largest blockchain asset—a 1,527% increase. In fact, USDT's massive market cap is one factor preventing Bitcoin dominance from climbing even higher.
Litecoin (LTC) was the fifth-largest cryptocurrency in December 2017, trading at $318. Currently, LTC is down 77% from that price and needs an 80% gain to reach its $375 ATH. Bitcoin Cash (BCH) held the third spot at $1,862; today it trades at $252, requiring an 86% rally to reclaim that level.
Other top 10 coins in 2020—such as Polkadot (DOT), Chainlink (LINK), and Binance Coin (BNB)—were not in the top 10 in 2017, which featured IOTA, Dash, and Monero. Cardano (ADA) was trading at $0.51 on December 17, 2017; it is now 78% lower and 91% below its $1.33 ATH.
Market Debates the Arrival of 'Altseason'
Despite these statistics, traders are still waiting for the so-called 'altcoin season.' On social media, the topic is trending, with many crypto proponents hopeful. One tweet read: "What comes after Spring? Summer. What comes after Bitcoin season? Altcoin season."
However, another user observed: "It looks like BTC dominance is rising, while the price is not rising so much. I think money is leaving alts → BTC → USDT, which keeps BTC up for a while. Until alts without USD pairs exit into BTC to then dump in USD." The account 'Altcoin Sherpa' agreed, stating: "Money definitely seems to be leaving alts in general. The high time frame trends on those are still bearish IMO, not altseason quite yet."
In summary, Bitcoin's surge to $17,000 and its 65% dominance highlight a market dynamic starkly different from 2017. Altcoins remain significantly undervalued relative to their historical peaks, and the long-anticipated 'altcoin season' remains a topic of fierce debate.