The cryptocurrency market in July saw a boom in Altcoin along with significant capital flowing into Ethereum, causing Bitcoin to lose some of its dominance.
The capital flow shift in July shows that traders may be taking profits in Altcoin as the market reaches an overbought state, while capital still pours into exchanges.
MAIN CONTENT
July marks a strong shift towards Altcoin, led by Ethereum thanks to record inflows into spot ETFs.
The total cryptocurrency market capitalization increased by 13.3%, Bitcoin approached its ATH but dominance rate sharply decreased, making room for Altcoin growth.
The volume of Altcoin deposits on exchanges surged, warning of potential corrections after a hot growth cycle.
What stands out in the cryptocurrency market in July?
July witnessed a profound change in the cryptocurrency market structure, with large capital flows strongly shifting towards Altcoin led by Ethereum.
The record inflow of capital into Ethereum spot ETF has sparked the strongest shift towards Altcoin since early 2021.
Market overview report 2025, AMBCrypto
The total capitalization of the entire market increased by 13.3%, mainly due to Bitcoin continuously testing its all-time high (ATH). However, the real highlight lies in the shift, as large amounts of capital began to move from Bitcoin to Altcoin. Ethereum's ability to lead capital flows is demonstrated by a chain of 19 consecutive days recording net inflows into the spot ETF.
This shift marks a structural turning point, with benefits spilling over to the Altcoin market as investors seek new opportunities outside of Bitcoin.
Why did the market capitalization increase significantly but Bitcoin's dominance rate decrease?
Although Bitcoin plays a central role when nearing its ATH, Bitcoin's dominance rate decreased by 5.2% to just 60.6%. Meanwhile, Altcoin strongly increased its market share, reaching 39.2% – the highest since early 2021.
The impressive growth of Altcoin in terms of dominance indicates that smart capital is shifting, seeking higher returns in riskier assets than Bitcoin.
Cryptocurrency market share report for July 2025, CryptoQuant
This is clearly shown when the capitalization amount (TOTAL3 – capitalization excluding Bitcoin and Ethereum) increased by over 100 billion USD after Bitcoin hit its ATH, proving that traders quickly shifted to the Altcoin segment to ride the price surge.
The market picture becomes clearer when comparing the BTC Dominance index and Altcoin Dominance: one side decreases, the other side increases sharply, confirming signs that investors are gradually shifting to riskier assets in search of better returns.
How does Ethereum dominate capital flows?
Ethereum surged with a strong increase in dominance above 12%, hitting this level for the first time since the 'Trump pump' phase. This phenomenon coincided with a record number of days with continuous net capital inflows into the Ethereum spot ETF.
The participation of spot ETF funds has strengthened Ethereum's position, creating a ripple effect across the entire Altcoin segment.
Cryptocurrency market analyst, AMBCrypto report 2025
When large financial resources flow into Ethereum, not only ETH benefits, but the entire Altcoin ecosystem also sees increased dominance rates. This reflects a trend of capital shifting from 'safe' assets like Bitcoin to riskier assets with better profit potential.
Especially, market data indicates that just one strong push from ETF capital flows is enough to help ETH and Altcoin break out, overshadowing Bitcoin's traditional dominant position in the short term.
How did the Altcoin capitalization index reach 980 billion USD?
After surpassing 1.070 trillion USD, the Altcoin capitalization index (TOTAL3) dropped back to 980 billion USD, recording a net withdrawal of about 20 billion USD in just the last two weeks.
Notably, two consecutive green candles appeared on the BTC Dominance chart in the weekly frame, indicating that the capital flow trend has temporarily stopped 'threatening' Bitcoin's dominant position.
This rapid capital withdrawal is primarily due to profit-taking effects, as many Altcoin have reached overbought states after hot growth phases. This is seen as a necessary technical adjustment to help the market balance supply and demand, avoiding bubble states.
What is causing the surge in Altcoin deposits on exchanges?
According to the CryptoQuant report, the number of Altcoin deposits on Binance has surpassed 45,000 in 7 days, the highest since late 2024.
Capital moving into exchanges often precedes a market-wide adjustment phase, as it is a move to take profits after Altcoin has surged.
In-depth report on on-chain capital flows, CryptoQuant 2025
The strong increase in these deposits indicates that investors are prioritizing realizing profits, rather than continuing to hold long-term positions. History has recorded that sudden money transfers like those in March and November 2024 are often associated with subsequent downward adjustments, affecting both Bitcoin and Altcoin.
On-chain data reinforces the view that when Altcoin deposits surge, selling pressure tends to increase, opening the door for adjustments in both the Altcoin segment and the overall market.
What does Bitcoin Dominance's movement signal for the trend?
The Bitcoin Dominance index unexpectedly turned down below 63%, even as Altcoin deposits surged. While this may appear to signal a capital flow shift, in reality, these capital flows are primarily for profit-taking rather than long-term investment in Altcoin.
The synchronization between the rally of Altcoin and the negative volatility of BTC Dominance reflects that the market is approaching a short-term reversal phase.
If no new upward momentum appears for the Altcoin segment, this profit-taking pressure could very well push the market into a correction phase, reducing the attractiveness of high-risk asset groups.
What does a 3% drop in Ethereum's price warn about Altcoin trends?
Shortly after a series of hot growth days, Ethereum's price dropped by 3% – a signal indicating that the upward momentum has weakened. When the market reaches an overbought state, the appearance of slight declines is normal to consolidate price levels.
Market history indicates that after hot growth phases, adjustments often occur to test the strength of new capital flows. If the momentum weakens, Altcoin will enter an accumulation phase, waiting for new breakout opportunities.
Long-term investors often see these declines as an opportunity to restructure their portfolios, balancing their Altcoin proportions and waiting for signals confirming the next upward trend.
Comparing the impact between Bitcoin, Ethereum, and the Altcoin market in July 2025
Below is a comparison table of key indicators regarding market share, capitalization, and capital flow of Bitcoin, Ethereum, and Altcoin in July 2025 based on data from AMBCrypto & CryptoQuant:
Asset | Market Share Change | Capital Flow | Spot ETF Change | Capitalization Change Bitcoin | Decreased 5.2% (to 60.6%) | Stable | Nearly ATH Ethereum | Increased over 12% | Record number of consecutive days (19 days) | Leading strong increase Altcoin (excluding BTC, ETH) | Increased from 29.2% to 39.2% | Not applicable | Added over 100 billion USD after BTC's ATH, adjusted to 980 billion USD
What to do when capital flows into Altcoin are peaking?
At a time when capital flows into Altcoin are high, caution is advised due to the significant risk of decline following a hot growth cycle. Market data and on-chain capital flows jointly warn that an adjustment trend is approaching.
For medium to long-term investors, actively taking partial profits or rotating into assets with strong fundamentals and high liquidity should be prioritized. For short-term traders, a flexible strategy with tight stop-loss points becomes crucial to preserve capital against strong volatility.
The market will continue to see strong adjustments, so investors should not go all-in on Altcoin that has just surged but need to regularly evaluate the portfolio structure.
Digital asset portfolio consulting expert, AMBCrypto, 2025
In addition, it's essential to closely monitor Altcoin deposit/withdrawal data on exchanges and the movements of Bitcoin Dominance to adjust investment strategies according to each phase.
Frequently Asked Questions
In July 2025, why did Bitcoin increase but lose dominance?
Although Bitcoin is nearing its ATH, large capital flows into Altcoin and Ethereum due to spot ETFs have caused Bitcoin's market share to drop to 60.6%.
Why does the capital inflow into Ethereum ETF have such a strong impact?
Record capital inflows into spot ETFs create a ripple effect across the Ethereum ecosystem, increasing dominance rates and attracting more capital into Altcoin.
What does the surge in Altcoin deposits on exchanges signify?
The high volume of Altcoin deposits on exchanges suggests that investors prioritize realizing profits, often signaling that the market is about to enter an adjustment phase.
What should investors do when Altcoin reaches an overbought state?
It is advisable to take partial profits or shift the portfolio to assets with strong fundamentals, avoiding spreading investments into Altcoin that has surged.
What impact does BTC Dominance decreasing have on the market?
As BTC Dominance decreases, Altcoin capitalization increases faster, leading to strong volatility and potential adjustment risks if capital momentum fades.
After the hot surge of Altcoin, will there be a sharp decline?
History indicates that after each strong surge, the market usually sees short-term technical adjustments to balance supply and demand, rather than always experiencing sharp declines.
What does the decrease in the TOTAL3 Altcoin capitalization index signify?
The net withdrawal of 20 billion USD indicates that investors are taking profits after the hot surge, warning of the possibility that the market will enter an accumulation or adjustment phase.
Source: https://tintucbitcoin.com/altcoin-tang-bitcoin-sap-tro-lai/
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