Crypto investors may be shifting their focus from Bitcoin to altcoins as a preferred safe haven during times of market uncertainty, according to a report from Bitfinex analysts. The resilience of altcoins, despite Bitcoin’s recent price dip, hints at a “potential regime change” in investor behavior.
Bitfinex’s report, published on 9 September, highlighted the relative strength of altcoins as Bitcoin’s price dropped to $52,827 on 7 September, marking a 10.8% decline over the previous week. While Bitcoin has since rebounded slightly to around $57,001, it remains well below the crucial $60,000 threshold.
Bitcoin is up 0.65% over the past seven days. Source: CoinMarketCap
The report noted that Bitcoin’s market dominance has decreased by 1.3%, while the market cap of all cryptocurrencies outside the top ten has increased by 4.4%. This shift suggests that investors are increasingly exploring value in altcoins, diverging from the usual pattern of flocking to Bitcoin during downturns.
At present, Bitcoin’s dominance stands at 57.33%, down 0.50% over the past week. This decline has led some traders to anticipate that Bitcoin dominance may be peaking, which is often viewed as a signal to move capital into altcoins.
Bitfinex analysts also pointed out that total Open Interest (OI) in altcoin markets has dropped by 55% from its all-time high. This indicates “speculative apathy” and potential exhaustion among sellers, suggesting that the altcoin market may be growing stronger.
Bitcoin dominance is down 0.53% over the past month. Source: TradingView
Crypto traders have echoed this sentiment, with many agreeing that fewer speculative bets on altcoins point to sustained strength. Prominent traders have expressed optimism, stating that altcoins could outperform Bitcoin in both upward and downward market movements.
As crypto trader Michael van de Poppe observed, “The current state of the altcoin markets represents a period of accumulation before a new push.” This suggests the potential for a strong altcoin phase in the near future.
