The price of bitcoin has fallen in 2025. Still, the largest cryptocurrency has outperformed other digital currencies, according to Matrixport. According to data from Matrixport, a financial service focused on cryptocurrencies, bitcoin’s dominance has reached new highs. The short-term recovery of altcoins is weakening.
Bitcoin dominance grows, altcoins retreat
As of March 12, bitcoin dominance, or bitcoin’s share of the total market capitalization of cryptocurrencies, stands at a cool 61.2%. This represents an increase from the cyclical low of around 54% in December. The growing dominance of BTC is clear evidence that the rise of altcoins has been short-lived, according to Matrixport. “It lasted barely a month, from Trump’s election in November to early December, when a stronger-than-expected US jobs report shifted the market’s attention to the Federal Reserve’s more hawkish stance,” the company said in a post on Platform X.
Bitcoin’s dominance usually declines towards the end of market cycles. It happens when capital moves into altcoins. Or digital assets other than bitcoin. In January, the US Federal Reserve decided to leave interest rates unchanged instead of starting another round of cuts. It cited strong US labour market data as the reason.
Fed’s hawkish stance pushes bitcoin down
The Fed’s hawkish stance has caused stocks and cryptocurrencies to fall . The price of bitcoin has fallen by around 20% since the central bank’s announcement on January 29. As of March 12, bitcoin is trading around $82,750. In December, it reached an all-time high of over $109,000. Altcoins are even more sensitive to macroeconomic volatility than bitcoin. “Experienced traders have shifted capital from altcoins to bitcoin, which despite its own decline has significantly outperformed the broader cryptocurrency market,” Matrixport said.
The next phase of bitcoin’ s growth will largely depend on whether the Fed decides to raise interest rates. This would be an effort to prevent inflation, Matrixport noted. On March 12, the consumer price index (CPI) for February was released. This is a key indicator of inflation in the US. It ended up coming out with a lower-than-expected reading of about 2.8%. “This is the first decline in both headline and core inflation since July 2024,” The Kobeissi Letter reported in a post on Platform X. “US inflation is cooling,” it added. Data from CME Group, a U.S. derivatives exchange, shows that markets now have a high probability of expecting the Fed to leave rates unchanged at its next meeting in March.
