Is Altcoin Season Coming Soon?

Jul 21, 2023
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There is a lot of talk about the altcoin season, also known as altseason, coming back to markets soon. Crypto experts have their various opinions on when exactly we will see it return. In the meantime, however, this helpful article will give you the basics of altseason so you can spot the indicators and prepare your portfolio.

What is altcoin season? Understanding Altseason

BTC.D Chart by TradingView

Altcoin season is a period when money flows out of Bitcoin and into altcoins. It results in a significant and rapid increase in their value. The Altseason happens when Bitcoin dominance decreases.  It refers to the percentage of Bitcoin's total cryptocurrency market share.  This leads to an increased investment in other cryptocurrencies, called altcoins. 

Altseason is a rewarding but rare period for crypto traders. The season offers a big opportunity for potential large returns. By capitalizing on the price movement, it is possible to earn a large profit. It also helps diversify your portfolio. 

Suggested reading: 7 Tips to Diversify Your Portfolio Today

Moreover, altcoins have the potential to outperform Bitcoin (BTC), so you should stay informed and seize the moment. These opportunities don’t happen often and are short-lived - make hay while the sun shines moment.

What are the indicators of the Altseason?

It is important to understand what drives Altseason. By understanding the factors behind it, you can plan your strategies better. That is how you make the most of Altseason in trading and investment.

Here are 4 key indicators of Altseason:

1. Bitcoin dominance chart (BTCD)

The most common way to look for altseason signs is by looking at the Bitcoin dominance chart. When Bitcoin dominance starts to decrease, it means more people are selling Bitcoins and buying into the broader crypto market. This can be a sign of the start of Altseason, where altcoin prices rise sharply. But when Bitcoin dominance increases, there's a much lower chance for the Altseason to happen.  

2. The market capitalization of altcoins (TOTAL2)

Total2 Chart by TradingView

The market capitalization of altcoins is the total value of all altcoins combined. You can analyze and compare historical data with current market conditions. There, you can find similarities in the patterns. It often follows previous market cycles. These patterns involve periods of both growth and decline. Thus, you can make predictions on future trends.

3. Ethereum separating from Bitcoin

Another way to predict the upcoming Altseason is by watching the Ethereum (ETH) price movement.  The performance of Ethereum is what drives the entire altcoin market.  The key indicator is when ETH starts to separate from BTC. It is an obvious sign when BTC's value is declining while ETH's is increasing. 

4. Market sentiment

It is usual that traders often get carried away when trading. Even after making calculations, the market movement may sway their emotions. As a result, there are many cases where traders make irrational trades. 

Traders can get over-excited about making profits when the market goes up. But when it goes down, they often panic sell. To avoid this common mistake, you can check the market sentiment indicator.

Some examples of the providers are Crypto Fear and Greed Index. But, they do not directly show the altcoin season. It is only used to broaden your understanding of what to expect from the cryptocurrency market. 

Understanding the Altcoin season index

The Altcoin season index is a tool that helps us determine our position concerning Altseason. The index shows the historical trends in a graph over monthly and yearly periods. It also provides insights into whether Altseason is currently happening or not. We can consider Altseason is underway when the performance of other coins is 75% better than Bitcoin in the last 90 days.

Best altcoins for Altseason

To decide which altcoins are that's best to invest in, you should do your analysis and research. There are some factors you can take into account before making investments in altcoins. 

  • Consider the following before buying :
  • market demand, 
  • project quality, 
  • technology innovations, 
  • and risk-reward ratio. 

You should remember that investing in cryptocurrencies involves risks. The altcoin season and market trends can change rapidly, making it highly volatile. 

Here, we cover some altcoin alternative recommendations based on expert analysis and market capitalization.

Ethereum (ETH)

ETH is a utility token for executing transactions in the Ethereum blockchain platform. It operates without a central authority and enables secure and transparent transactions. Developers also use it to create smart contracts and decentralized applications (dApps). There is a debate about the classification of ETH as an altcoin. This is because Ethereum has positioned itself as a prominent blockchain for smart contracts. ETH market cap is the biggest among altcoins. The current market cap is around $390B.

Binance Coin (BNB)

Binance Coin is also a utility token. You can use it to pay trading fees and enjoy discounts on the Binance exchange. BNB facilitates payments outside the platform as well. BNB's current market cap is around $75B.

Ripple (XRP)

Some consider XRP to be a unique type of cryptocurrency. People think it is different from the traditional ones because XRP does not have the same decentralized nature. XRP is a digital currency used on the Ripple network. It makes international money transfers fast and low-cost. The current market cap stands at around $32 billion. 

Cardano (ADA)

Cardano is a blockchain platform, while ADA is the native token of Cardano. ADA has achieved faster transaction speeds. It results in a more efficient and streamlined transaction on the Cardano blockchain. The current market cap stands at around $21 billion.

Solana (SOL)

Solana started its operation in 2020, making it a relatively new cryptocurrency. The platform is similar to Ethereum. People use it to create decentralized apps as well as smart contracts. You can also use Solana to make quick and secure transactions. Moreover, it can be one of your affordable choices. Solana is one of the fastest blockchains to exist. The current market capitalization of Solana is around $80 billion.

Previous Alt Coin Seasons

The 2017-2018 alt season, peaking from December 2017 to early January 2018, was a period of explosive growth in the cryptocurrency market. Fueled by retail investor FOMO and the ICO craze, many altcoins experienced unprecedented price surges, some gaining over 1,000% in mere weeks. However, after the frenzy, the markets crashed, with many cryptocurrencies going to zero in the following months.

In 2021, the crypto market experienced another significant bull run, with Bitcoin reaching new all-time highs and many altcoins following suit. This bull run was characterized by the rise of decentralized finance (DeFi) and non-fungible tokens (NFTs), which attracted a new wave of investors and developers to the space.

Among the notable performers during the 2021 bull run was Solana, experiencing meteoric growth during the 2021 bull run. SOL's price rose from around $1.50 in January 2021 to an all-time high of over $260 in November 2021, making it one of the top-performing cryptocurrencies of the year. Unfortunately, November saw the beginning of a broader market correction that affected not just Solana but the entire cryptocurrency market. As the 2021 bull run began to lose steam in November, the cryptocurrency market entered a prolonged bear market that lasted throughout 2022 and into 2023.

With the approval of the Bitcoin Spot ETF and billions of dollars of inflow into the market, there are signs of a potential altseason for 2024. Some narratives, such as AI and Meme coins, have already exploded. If these narratives continue to gain traction, we could see a broader impending altcoin season reminiscent of the 2017-2018 and 2021 bull runs. However, nothing is set in stone so watch for those indicators we discussed.

How long is Altcoin season?

Historically speaking, altcoin season is a 3-month period of significant altcoin growth. The next one is not here yet, so it’s the perfect time to start preparing. Click the button below and buy your favorite altcoins before altseason hits us!

Disclaimer: “The content should not be construed as investment advice and does not constitute any offer or solicitation to offer or recommendation of any investment product. It is made available to you for information and/or education purposes only.

You should take independent investment advice from a professional in connection with, or independently research and verify any information that you find in the article and wish to rely upon.”

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