Bitcoin Dominance Peaks, Signaling “Banana Zone”

The crypto market is buzzing with activity as Bitcoin surpassed the $100,000 mark on May 8, reaching its highest level since early February 2025.

This milestone added nearly $300 billion to the total crypto market cap and sparked heated debates about the next moves of Bitcoin and altcoins.

Why Might the “Banana Zone” Be Triggered?

Raoul Pal, veteran investor and founder of Real Vision, believes Bitcoin Dominance (BTC.D) peaked on May 8, 2025.

TradingView data shows BTC.D dropped from 65.3% to below 64% in just two days. This marked the sharpest decline after two months of steady increases.

Pal offered a broader perspective. He noted that the current BTC.D peak is lower than the highs of 2021 and 2017, aligning with historical patterns. He predicted this could signal the next phase of the “Banana Zone”—a term he coined to describe a parabolic surge in crypto prices, forming a banana-shaped curve on the chart.

“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,” Raoul Pal predicted.

The “Banana Zone” often coincides with an altcoin boom. Investors typically shift funds from Bitcoin into altcoins in search of higher returns.

However, not everyone agrees with Pal. Analyst Mark Harvey countered his view on X, claiming that Bitcoin Dominance is returning to 100%. Harvey argued that the rise of spot Bitcoin ETFs and strong institutional inflows will help Bitcoin reinforce its dominance.

Altcoin Season Index Hits Two-Month High

Meanwhile, CoinMarketCap’s Altcoin Season Index data shows the index has reached a two-month high of 41. Though still below the 75-point threshold that defines altcoin season, the indicator has exited the “Bitcoin season” zone and entered neutral territory, signaling a return of positive sentiment.

Merlijn The Trader, a well-known analyst, agreed that the altcoin season has begun. He cited Blockchain Center’s index version and argued that it recently broke through months-long resistance. He added that Tether Dominance (USDT.D) is trending down, which signals a perfect setup for altcoin season.

“Altcoin Seaso signal just triggered… 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,” Merlijn The Trader said.

These differing views highlight the complexity and unpredictability of the crypto market. Will Bitcoin’s Dominance truly reverse, allowing altcoins to surge, or will Bitcoin continue to assert its dominance? The market’s reaction in the coming weeks—amid macroeconomic developments and shifting investor sentiment—may soon provide the answer.