The cryptocurrency market is witnessing a brutal downturn, with Bitcoin failing to sustain momentum above $100K while altcoins continue to bleed. Following the economic uncertainty triggered by Trump’s trade war, the crypto market saw a widespread sell-off. Bitcoin currently trades at $97K after a modest recovery, but major altcoins such as Ethereum (ETH), XRP, Solana (SOL), Dogecoin (DOGE), and Cardano (ADA) have dropped 3-4% today.
Why Is Bitcoin Struggling While Altcoins Freefall?
Renowned crypto analyst CryptexGuy attributes this trend to Bitcoin’s historical cycles. Prior to 2019, Bitcoin experienced an 88% drop before rallying by 12,000%, with altcoins following suit. A similar pattern emerged during the 2018-2021 boom when Bitcoin fell 85% before surging nearly 2000%. This period saw mass crypto adoption, fueled by the COVID-19 crisis and the rise of NFTs. However, as the pandemic eased and traditional jobs regained stability, the crypto sector lost steam, leading to a significant market correction.
Why is $BTC aka #Bitcoin slow now & #Altcoins have gone almost zero?
— CryptexGuy (@CryptexGuy_Dyor) February 6, 2025
Thread, Must Read
🧵 1/5 pic.twitter.com/XiYOS2RkC0
2022-2025: A New Cycle, Familiar Trends
In this ongoing market cycle, Bitcoin saw a sharp 77% decline due to macroeconomic factors, including the collapse of FTX and Luna. Yet, it managed a strong recovery from $15,000 to over $109,000—an impressive 600% gain, largely driven by institutional adoption and increased government participation in Bitcoin mining.
Meanwhile, altcoins continue to struggle. While the previous cycle was powered by Ethereum’s growth and the NFT boom, the current landscape favors meme coins and Bitcoin’s rising prominence in U.S. financial reserves. Certain altcoins, such as XRP (aided by SEC legal developments), ONDO, HBAR (buoyed by BlackRock interest), and AI-related tokens, have garnered investor attention. However, the majority remain in a downward spiral.
#BTCDOMINANCE Gravestone Doji 🪦
— Titan of Crypto (@Washigorira) February 5, 2025
Two days ago, #BTC dominance printed a highly bearish candlestick on the daily. Rarely have I seen a Gravestone Doji of this magnitude on BTC.D.
Could this signal the beginning of an awakening for #Altcoins? 🚀#ALTSEASON pic.twitter.com/xYU9Oi1htK
Can Altcoins Survive This Bearish Phase?
Technical analysts suggest mixed signals. Titan of Crypto highlights the formation of a “Gravestone Doji” on Bitcoin Dominance (BTC.D), a potential indicator of an altcoin resurgence. However, Rekt Capital cautions that Bitcoin dominance must reach at least 71% before a sustained altseason can occur.
Also Read: Bitcoin Whales Accumulate as Market Dips—Is a $101K Breakout Next?
For now, Bitcoin ETFs are absorbing much of the capital inflow, leaving altcoins struggling to capture investor interest. The market’s next big move hinges on Bitcoin’s performance—until then, altcoins remain in limbo.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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