XRP, DOGE & SOL Lead the Crypto Slump — But Altseason Remains Possible if This Key Level Breaks

Altcoin Season on Hold? Bitcoin Dominance Drops, but Analysts Await Confirmation

Bitcoin’s dominance has dipped below a key technical threshold, renewing speculation about a potential altcoin season — but analysts warn the breakout is not yet confirmed.

Despite only a mild retreat in Bitcoin’s price — down roughly 3% from its midweek high of $120,000 — the broader crypto market has turned sharply lower, with major altcoins leading the decline.

XRP, DOGE, SOL Extend Losses

Among the top ten cryptocurrencies, XRP, Dogecoin (DOGE), and Solana (SOL) posted the steepest losses on Friday, each falling around 5% over the past 24 hours, according to CoinDesk data. From Wednesday’s highs, XRP and DOGE are down roughly 18%, while SOL has dropped 12%.

The broader altcoin space didn’t fare much better. The CoinDesk 80 Index — which tracks mid-cap altcoins outside of the CoinDesk 20 — shed 10% from its weekly high.

Ethereum’s ETH managed to hold up relatively well, down 4% from its recent peak, supported by ongoing institutional accumulation from crypto-focused treasury firms.

Excessive Leverage Driving Volatility

According to a research note from Coinbase’s head of research David Duong, the recent drawdown is primarily a result of over-leveraged positioning in altcoin markets.

He highlighted that the Altcoin Open-Interest Dominance — a ratio comparing the dollar value of altcoin derivative contracts to Bitcoin’s — surged to 1.6, a level that has historically preceded broad market corrections. A pullback in this ratio would indicate a healthy reset in leverage, but without it, the market may remain vulnerable to further unwinding.

Altseason Index Cools Down

The CoinGlass Altcoin Season Index, which measures the relative performance of altcoins against Bitcoin on a 0–100 scale, dropped to 41 on Friday — down from 59 earlier in the week. Monday’s reading marked the strongest signal since the altcoin rally in late January tied to speculative trading ahead of President Trump’s inauguration.

Still, Duong noted that the altcoin market (excluding stablecoins) has nearly doubled in value since April, reflecting robust inflows and appetite for risk.

Bitcoin Dominance Breaks Key Level

The real test for an extended altcoin rally may lie in Bitcoin’s dominance trend. The metric — which tracks BTC’s share of the total crypto market cap — has fallen below its 200-day moving average for the first time since a brief dip in January. Historically, such breaks have preceded sustained periods of altcoin outperformance, such as the rally seen in 2021.

“A confirmed move below the 200-DMA could strengthen the altcoin season narrative,” Duong wrote. “But it’s more prudent to wait for multiple daily closes under that level before aggressively rotating into altcoins.”

For now, traders remain cautious, with leverage metrics and dominance levels sending mixed signals — suggesting that while altseason may be on the horizon, it hasn’t arrived just yet.

About The Author

ctleditor

See author's posts