Definition. The BTC/ETH Dominance oscillator tracks the macro outperformance trends between the top two crypto-assets. It considers only the market cap of Bitcoin relative to the combined market cap of Bitcoin plus Ethereum, rendered as an oscillator with orange columns when Bitcoin is dominant and blue columns when Ethereum is dominant, alongside the two market caps themselves (BTC orange, ETH blue).

Technical. The oscillator is calculated as follows:

• Dominance = BTC Market Cap / (BTC Market Cap + ETH Market Cap) - 0.765

The 0.765 centering constant is the midpoint of the oscillator's long-run regime band, so readings oscillate around zero. Guide lines at +0.085 (green, peak BTC dominance) and -0.085 (red, peak ETH dominance) mark the historical extremes of that band.

Interpretation. The oscillator distinguishes which of the two majors is leading the market:

• Higher values and uptrends (orange) indicate outperformance by Bitcoin, characteristic of risk-off phases and Bitcoin-led trends.

• Lower values and downtrends (blue) indicate outperformance by Ethereum, typically seen when risk appetite broadens beyond Bitcoin.

Approaches of the ±0.085 extremes have historically marked saturation points of the prevailing rotation, after which relative performance has tended to consolidate or revert.

Notes. This chart was introduced and discussed by Glassnode in The Week On-chain Newsletter - Week 21, 2022 and again in A Challenging Bear Market (July 2022). Built from Market Cap. A realized-cap analogue is charted in BTC/ETH Realized Cap Dominance, and derivatives-market rotation in BTC/ETH Futures Open Interest Dominance.