Bitcoin Dominance Climbs to 60%–61.3% in Early May 2026, Marking the Strongest Level Since Mid-2025 and the First Sustained Break Above the Psychological 60% Threshold in 2026. This is More Than a Technical Breakthrough—It Signals a Significant Shift in the Crypto Market’s Capital Structure.
Historically, Bitcoin dominance typically fluctuates between 40% and 70%. The 60% level sits in the upper-middle range, serving as a critical psychological and technical threshold. When Bitcoin dominance exceeds 60%, it signals that capital is concentrating in Bitcoin rather than rotating into altcoins. Historically, this structure emerges in the early-to-mid stages of bull markets or during periods of macro uncertainty, when investors prioritize the safest and most liquid assets in crypto. Sustained Bitcoin dominance above 60% essentially represents the market’s cyclical vote for a "certainty premium."
What Structural Cooldown Is Occurring in On-Chain Volume and Active Users?
The rise in Bitcoin dominance is not an isolated technical event. Behind it, both ETH and SOL are experiencing a synchronized decline in on-chain activity—together painting a complete structural picture.
On Ethereum, on-chain data shows multi-dimensional weakening. Over the past week, average weekly Ethereum transfers dropped 10% to 4.79 million; active wallet count fell 8% to 2.5 million. Decentralized exchange (DEX) weekly trading volume also saw a significant drop: as of May 8, DEX volume fell to $1.64 billion, down 46% over the past three weeks. Alongside this ecosystem contraction, total value locked (TVL) in Ethereum DeFi protocols fell to $124.7 billion, the lowest since May 2025.
Solana is also seeing a contraction in on-chain activity. Weekly active addresses plummeted from a February peak of 5.01 million to 2.89 million—a 42% decline. Notably, Solana’s social sentiment is diverging sharply from its on-chain data: bullish sentiment far outweighs bearish, with a sentiment indicator hovering around 3.2. This means there are over three bullish posts for every bearish one on social media. This "bullish sentiment, bearish data" scenario suggests that current optimism for Solana is driven mainly by narrative, not by actual network usage.
How Is Institutional Capital Asymmetrically Distributed On-Chain?
Analysis from CryptoQuant highlights that the 2026 rebounds in Bitcoin and Ethereum are being driven by fundamentally different demand conditions—a divergence that will shape the market’s next phase.
Bitcoin’s recovery reflects ongoing institutional spot accumulation. Investors are buying BTC on spot markets and moving it off exchanges for long-term storage, reducing available selling supply. On May 4, US spot Bitcoin ETFs saw a single-day net inflow of $532 million, with total net inflows in April reaching $2.44 billion—the strongest monthly institutional buying in nearly eight months.
Ethereum, however, tells a different story. ETH appears to be stabilizing mainly because selling pressure has eased, not because new spot demand is building. On May 4, US spot Ethereum ETFs reported $61.29 million in net inflows, but CryptoQuant notes that ETH’s capital flows lag far behind Bitcoin’s in both scale and persistence.
The essence of this divergence: Bitcoin’s rally is driven by spot demand (positive inflows), while Ethereum’s stability is due mainly to reduced selling pressure (negative relief), not new buyer entry. Without systemic Bitcoin exposure risk, ETH price will struggle to replicate Bitcoin’s strength absent a new narrative shift.
Is the Market Still in Bitcoin Season or Transitioning to Altcoin Season?
While Bitcoin dominance remains above 60%, another key indicator is also shifting.
The 90-day Altcoin Season Index has risen from a Bitcoin-dominated low of 20 to about 28.6. However, the official threshold for "altcoin season" is 75—meaning at least 75% of leading altcoins have outperformed Bitcoin over the past 90 days. The current index is still 47 points away from this threshold—a gap even wider than the index’s rise from its recent low. In terms of trading volume, the current altcoin volume ratio versus the top five assets is about 0.3–0.4, whereas during the 2021 altcoin season peak, this ratio exceeded 2.0. This means the current rotation is only about 15%–20% the scale of the last true altcoin season.
At this stage, "the market is in Bitcoin season" remains the most accurate assessment. The direction of capital rotation is clear, but the scale is only in the "confirmed start" phase, not "fully underway."
How Will New Token Unlocks Impact Short-Term Market Structure?
Another structural factor behind sustained Bitcoin dominance above 60% is supply-side pressure on altcoins.
By May 2026, over $2.2 billion in new altcoin supply is expected to enter circulation, bringing short-term selling pressure and increased volatility—especially among mid-cap assets. Historically, when Bitcoin dominance holds above 60%, even if the Bitcoin price remains stable, altcoins can experience corrections of 15% to 35%.
On Ethereum, staking unlock pressure is especially pronounced. The Ethereum unlock queue surged over 72,000% in two weeks, reaching 530,985 ETH awaiting unlock as of May 2. Several major DeFi security incidents in April 2026 resulted in a record $625 million in losses—including a $292 million loss from the KelpDAO bridge attack and over $1.5 billion in outflows from Aave. These events have prompted risk-averse investors to reclaim their ETH. The dual pressures of mass unlock expectations and on-chain security incidents reinforce the structural trend of capital continuing to concentrate in Bitcoin in the short term.
Is 60% a Critical Threshold or the Start of a Long-Term Trend?
From a technical analysis perspective, 60% carries multiple implications.
Bitcoin dominance is currently trading in the 60%–61.3% range, with 58%–61% now serving as the main accumulation and breakout zone. Analysts typically watch three key areas: Bitcoin dominance above 63% signals a continued bull market, with Bitcoin maintaining leadership and altcoins likely still suppressed; 58%–60% is a key equilibrium range, marking rotation between Bitcoin strength and early altcoin recovery; if Bitcoin dominance closes below 60% on a weekly basis, it may signal the start of large-scale capital rotation into altcoins, while a drop below 50% would indicate a full-fledged altcoin season.
If Bitcoin dominance stays above 60% and ETH fails to show comparable spot demand persistence, CryptoQuant expects Bitcoin dominance to remain elevated. Conversely, if ETH develops a similar spot demand structure, a broader altcoin rally could emerge as capital rotates out of Bitcoin and into the wider market.
In the longer term, Bitcoin dominance has climbed from around 40% to nearly 60% since 2022. Some research suggests Bitcoin dominance could approach 70% by 2030. This implies that the current structural shift may not be a one-off fluctuation, but rather a transitional stage in the evolving long-term power dynamics of the market.
Conclusion
In early May 2026, Bitcoin dominance broke above 60% for the first time and has continued to trade above that level, signaling a clear shift in the crypto market’s capital structure. Systemic drivers of this trend include: macro uncertainty pushing capital toward Bitcoin, institutions absorbing Bitcoin supply via spot ETFs, weakening fundamentals in ETH and SOL reducing capital outflows, and over $2.2 billion in new altcoin supply releases intensifying the structural trend of capital concentrating in Bitcoin. The current Altcoin Season Index sits at about 28.6, still far from the 75 threshold required to trigger an altcoin season, confirming that the market remains firmly in "Bitcoin season." The 60% mark is not only a technical dividing line for the current market structure—it may also become a long-term inflection point for future capital allocation trends.
Frequently Asked Questions (FAQ)
Q: What does 60% Bitcoin dominance mean?
A: 60% is a key psychological and technical threshold in the market’s capital structure. Sustained Bitcoin dominance above 60% typically means capital is heavily concentrated in Bitcoin, with altcoins underperforming and seeing reduced inflows—the market is in "Bitcoin season."
Q: What are the main reasons for declining on-chain activity in ETH?
A: Several factors are behind Ethereum’s drop in on-chain activity: DEX trading volume has fallen 46% over the past three weeks; DeFi TVL is at its lowest since May 2025; on-chain security incidents have led to a record $625 million in losses; the Ethereum unlock queue has surged, with significant liquidity exiting staking pools. US investor selling pressure is also higher than the global average, contributing to the decline.
Q: Why is there a disconnect between SOL’s on-chain data and market sentiment?
A: Solana’s social sentiment ratio has climbed to 3.2 (bullish/bearish), indicating rising market attention for SOL. However, weekly active addresses are down 42% from February highs, and even with continued ETF inflows, on-chain activity has dropped to 2.89 million. This suggests a short-term divergence between price and fundamentals.
Q: How low does Bitcoin dominance need to fall to confirm the start of altcoin season?
A: Technical analysts usually look for confirmation on the weekly close. If Bitcoin dominance closes below 60% on a weekly basis, it may signal the early stage of capital rotation into altcoins; a drop below 50% would indicate a full-fledged altcoin season. The current Altcoin Season Index is about 28.6, still well below the official 75 threshold.
Q: What needs to happen for ETH to see renewed capital inflows?
A: According to CryptoQuant, ETH needs to demonstrate persistent spot buying on par with Bitcoin before the broader crypto market can see a more extensive altcoin rally. Until then, institutional capital is likely to remain focused on Bitcoin spot demand. ETH also needs to see a real recovery in on-chain activity, including a rebound in DeFi TVL and a return to growth in DEX trading volume.
