What I'm curious about is if btc could even survive without a proper alt market. It's not like btc's volume mostly comes from actual use -- nobody really uses btc to buy goods. There is of course btc trading for fiat, but I expect a large percentage of btc volume involves trading with alts. But when dominance is this high, alt volume goes down ... so eventually if alts get crushed into smithereens, and btc dominance goes crazy, who will be trading btc for alts anymore?
Make no mistake, alts need bitcoin but the same is not true for bitcoin, most people that invest in alts do not really believe in the promises of their developers, the only thing they want is for alts to grow faster than bitcoin so they can get more bitcoin in the process, if alts disappeared and all the money in the market was invested in bitcoin then we will be close to the all time high and you can be sure there will be an intense activity in all exchanges as people speculate how high the price will go this time.
But that's the thing, why should we assume all money currently invested in alts would magically go into btc instead? It seems like too many folks invest with money they really can't afford to lose, so if alts get crushed, why assume they'd take whatever is left and put it into btc? More likely they'd be at such a loss, they wouldn't have that much money to put into btc to begin with. And some may be so annoyed with crypto in general, they'd just avoid the markets entirely.
I agree that most folks use alts as a way to speculate in order to gain more btc. But if alts didn't exist, I wouldn't just automatically assume everyone would flock to btc. I'd also be curious what btc's volume would look like once we remove exchange volume for alts... I certainly don't think it'd look like it is now.