What exactly is Bitcoin dominance, and why does it actually matter in the crypto space?

So here's the deal: Bitcoin dominance is basically a metric that shows what percentage of the total crypto market cap belongs to Bitcoin. When BTC dominance is high, it means Bitcoin is pulling the majority of the market's attention and capital. When it's low, altcoins are getting a bigger slice of the pie.

Why should you care? Well, Bitcoin dominance often acts as a leading indicator for market direction. During bull runs, Bitcoin typically establishes dominance first, then the money flows into alternative coins. Conversely, when BTC dominance starts shrinking, it can signal that traders are rotating into alts or taking on more risk.

Think of it as a barometer for risk appetite in crypto. High dominance tends to mean a more conservative market where people are sticking with the largest, most established asset. Lower dominance suggests traders are hunting for higher returns with smaller projects.

Understanding Bitcoin dominance helps you gauge market sentiment and positioning. It's one of those metrics worth keeping on your radar if you're serious about trading or investing in digital assets.