By Key Points
- Bitcoin hits $100K, sparking $300B market cap boost and altcoin buzz
- Raoul Pal says BTC dominance has likely peaked, entering “Banana Zone”
- Altcoin Season Index jumps to 41, leaving Bitcoin dominance territory
- Analysts split: altcoin boom or Bitcoin supremacy to continue?
Bitcoin reached a major psychological milestone on May 8, crossing the $100,000 mark for the first time in 2025. This surge injected $300 billion into the crypto market in a matter of hours, reviving hopes for another explosive bull run. But while Bitcoin took the spotlight, the real story may be what’s happening just beneath the surface—Bitcoin Dominance might be slipping.
Raoul Pal, CEO of Real Vision and a former Goldman Sachs executive, believes this could be the start of a new phase. He pointed out that Bitcoin Dominance dropped from 65.3% to below 64% in just two days. Though small on the surface, this shift echoes patterns from 2017 and 2021—periods right before altcoins exploded in value.
Bitcoin Dominance Chart. Source: TradingView – Techtoken
According to Pal, this marks the potential return of what he calls the “Banana Zone”—a period of parabolic growth in altcoins where price charts form a steep, banana-like curve. His theory is based on technical patterns like the DeMark indicators showing tops across daily, weekly, and monthly charts.
“The top is well below the 2021 high and that was already below the 2017 top,” said Pal. “It’s a clear sign that Bitcoin Dominance may have peaked.”
I think BTC dominance topped today. There are daily, weekly and monthly DeMark tops in place and the top is well below 2021 top and that was below the 2017 top.
If that plays out, it is the hallmark of the next phase of the Banana Zone. Let’s see…
— Raoul Pal (@RaoulGMI) May 8, 2025
As a result, many traders may start rotating profits from Bitcoin into smaller altcoins, hoping to catch early momentum in projects like Solana, Avalanche, and emerging DeFi tokens.
Still, not everyone is convinced. Analyst Mark Harvey fired back, saying Bitcoin’s Dominance could actually be on its way to 100%. He argues that spot ETFs and growing institutional demand will continue driving capital into Bitcoin over altcoins.
If you’re watching for macro factors, you might want to also keep an eye on developments like Arizona’s newly proposed Bitcoin Reserve Fund, which could bolster long-term demand for BTC.
Altcoin Season Index Breaks Resistance, Sparks Buzz
While analysts clash on direction, market indicators are starting to shift. CoinMarketCap’s Altcoin Season Index has climbed to 41—the highest in two months. It’s still short of the 75 required to confirm a full altcoin season, but the movement out of Bitcoin territory signals growing optimism.
Altcoin Season Index Chart. Source: CoinMarketCap – Techtoken
Well-known trader Merlijn The Trader echoed Pal’s sentiments. He believes altcoins are ready to take over, noting that Blockchain Center’s version of the index has broken past long-term resistance.
“Altcoin Season signal just triggered,” Merlijn wrote. “Bitcoin season dominance is cracking. If you’re not positioned now, you’ll be exit liquidity later.”
ALTCOIN SEASON SIGNAL JUST TRIGGERED
They laughed while it bled.
Now the index just snapped a multi-month downtrend.
Bitcoin season dominance is cracking.If you’re not positioned now, you’ll be exit liquidity later.
Alts are loading.You either lead or get left. pic.twitter.com/jxx9FA5tbq
— Merlijn The Trader (@MerlijnTrader) May 8, 2025
Adding fuel to the fire is the drop in Tether Dominance (USDT.D), a key indicator of risk-on sentiment. When USDT.D falls, it often means investors are moving stablecoins into riskier altcoin positions.
This comes just weeks after other significant shifts in crypto sentiment, such as Ripple’s $75M investor win and the Trump-XRP lobbying scandal—events that stirred confidence in altcoin projects by clearing legal hurdles and drawing media attention.
Airdrop Fever and Altcoin Volume Surge
One more reason altcoins might be about to fly? Trading activity is exploding. According to recent data, Binance Alpha’s altcoin volume hit $2.8 billion as airdrop hunting surges. Traders are rapidly accumulating smaller-cap tokens in hopes of receiving retroactive rewards—similar to what we’ve seen from projects like Arbitrum and Optimism in previous cycles.
As altcoin liquidity grows, more retail and institutional players may jump into speculative trades, reinforcing the cycle Pal describes as the Banana Zone. Social sentiment on platforms like X and Telegram is heating up with chatter around lesser-known tokens that could “do a 10x.”
Even relatively quiet ecosystems like Pi Network are seeing renewed interest, especially after the Finland update sparked discussion around mainnet readiness.
These moves indicate that crypto money is starting to spread again—not just into Bitcoin or Ethereum, but deep into the altcoin universe.
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