Bitcoin dominance crumbles: Top 10 beginner friendly altcoins to watch

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Bitcoin dominance dips to 55.81%, down from its November 2024 top of 61.53%. Declining BTC dominance has paved the way for the altcoin season, with over 75% of the top 100 altcoins consistently outperforming Bitcoin. Let’s deep-dive into the top 10 altcoins for beginners to buy in December 2024.

Why Bitcoin dominance matters to altcoin traders

Bitcoin dominance is a percentage measure of how much of the total crypto market value belongs to BTC. This is an important metric for traders as it helps identify how capital is distributed between Bitcoin and altcoins. 

At 55.81%, over half of the total crypto market value belongs to Bitcoin and the rest of the capital is likely flowing into altcoins. Typically, a decline in Bitcoin dominance during bull markets is a sign of potentially higher returns on altcoins. Bitcoin dominance is therefore used to identify altcoin trading opportunities. 

Bitcoin dominance suddenly drops, signalling the start of an altseason, a time period where over 75% of the top 100 altcoins consistently outperform BTC in a 90-day timeframe. The shift occurs in capital flow, and traders capitalize on the opportunity by minimizing exposure to BTC while investing in high-liquidity altcoins. 

The Bitcoin dominance chart on TradingView shows a likelihood of a nearly 5% decline to the confluence of 100 and 200-day Exponential Moving Averages (EMAs) at 53%.

What makes an altcoin worth investing in

In order to make the most of the altseason, beginners need to consider these five points as a checklist when buying an altcoin. 

Fundamental use case and utility

The purpose of the real-world use case of an altcoin is one of the most important points to consider before buying a token. Questions to consider are: what is the real-world use case? How do blockchain technology and the token simplify an existing problem? What is the unique value proposition of the altcoin? 

Two altcoins that fit the criteria and rank within the top 100 cryptos by market capitalization are Polygon and Chainlink. MATIC is a layer-2 scaling solution that enables faster and cheaper transactions for users while capitalizing on Ethereum as the underlying security layer. 

Chainlink connects smart contracts with real-world data and finds utility in traditional and decentralized financial institutions, crypto exchanges and banks. 

Tokens with no utility may enable short-term gains; however, once the hype surrounding the project dies, most token holders typically face unrealized losses. 

Market capitalization and liquidity

An altcoin’s market capitalization is a measure of the size and relevance of the project among traders. Large market cap projects like Ethereum, Binance Coinare typically considered safer than other altcoins, the potential of price gains is low to moderate in most cases. But mid to small-market cap projects, meme coins on Base, and Ripple have a relatively higher potential for gains with higher risk.

Strategic considerations and risk 

The total crypto market capitalization is a key metric used to determine what to expect from a portfolio that consists of the above 10 altcoins. Based on projections, the total market capitalization of crypto excluding Bitcoin could surge to $4.47 trillion. 

An increase to the projected levels implies a likelihood of 2X gains in the portfolio with the top 10 altcoins listed above. Factors like duration of the altseason, Bitcoin’s performance, institutional investor interest and inflow of capital could influence the market cap. 

Traders can expect between 2X and 3X gains this cycle, at the entry points marked in the weekly charts above.