Key Points
- Bitcoin’s surge is causing a rare divergence with the broader altcoin market.
- Analysts warn that this rally could be fragile and face a sudden reversal.
Bitcoin’s [BTC] recent surge is attracting attention for unusual reasons. As the BTC steadily ascends, the wider altcoin market is hitting a standstill, creating an uncommon divergence.
Bitcoin’s Ascent and Altcoin Correlation
The 14-period rolling correlation between BTC and major altcoins has seen a sharp decrease since late April 2025. This is a departure from previous rallies where altcoins moved in sync with Bitcoin. Currently, most altcoins are showing near-zero or negative correlation on a 12-hour timeframe.
This divergence, marked by cooler blue shades in the heatmap, indicates a narrowing market. A Bitcoin-led rally often lacks long-term strength and can sometimes precede a broader risk-off shift in the market.
Bitcoin Dominance
BTC’s price rise has been accompanied by a strong resurgence in market dominance, not just for BTC alone, but also when combined with stablecoins. The combined dominance is close to 70%, indicating a return to risk-off behavior and consolidation of capital in “safer” crypto assets.
Despite price gains, BTC dominance change has often turned negative, underscoring continued capital rotation and market indecision beneath the surface strength.
