Indicators Are Pointing To The Altseason We’ve All Been Waiting For
Altseason is coming?
Covered:
- Bitcoin’s Incredible Growth
- Ethereum And “Big Caps”
- What Does This Mean For Altcoins?
Bitcoin’s Incredible Growth
Bitcoin climbs higher and higher throughout October to reach a record of $66.9k. With a staggering total market cap of $2.77 trillion, Bitcoin alone stands for just under half of the entire crypto market cap at 42.3%. As Bitcoin takes a much-needed breather, we still see the entire crypto market surge in total market cap. This begs the question, where are all the gains coming from if not Bitcoin? We have seen incredible growth from Ethereum, Shiba Inu, Solana, DeFi, and recently, metaverse cryptos, with incredible returns on investment.
History may not always repeat itself, but it often rhymes! In prior market cycles, we have seen a lot of consistency with the way the market behaves. Does that mean we are in store for another altseason like we saw back in January 2018?
Chart developed on Coin Metrics. Source: Cryptonews.com
Each graph is centered in their cycle bottoms up to their peak in their respective cycle. We can see each cycle top consistently takes longer to get to, with steady appreciation. As of right now, the biggest factor in the graph is the “fourth cycle” (after the 3rd halving). In it, the cycle bottom was in 2020, at around $9,000 per Bitcoin. As the 3rd halving occurs in mid-2020, we see steady price action throughout 2020 and 2021. As a result, we see an impressive all-time high for bitcoin at $66.9k. Bitcoin dominance remains high, but Ethereum can also command the market.
Ethereum And “Big Caps”
We’ve seen the total market cap climbing, after bitcoin’s incredible run. After Bitcoin’s positive price action, we often see liquidity trickle down into Ethereum. Ethereum just a week ago has seen steady growth, crushing a record high as well, with a respectable 500k market cap.
Recommended: Want to learn more about Ethereum? Learn more from our altcoin guides
The top 15 crypto have seen tremendous growth as well. These are the “big caps”, cryptos with market caps over 15 billion dollars. We have seen Solana, Polkadot, Shib, and Avalanche hit records highs the past couple of weeks. Most of these cryptos are massive network protocols that have many projects built on top of their blockchains. The liquidity now sits within these networks, and money will likely flow into smaller cryptocurrency projects.
What Does This Mean For Altcoins?
As Bitcoin ebbs and flows from dip to spike, we can generally predict the next big move. Throughout the recent bull-run we see the money flow into Bitcoin, then into large caps, and lastly, into altcoins. One can theorize that when bitcoin does well, it will steal market dominance (bitcoin dominance), but when bitcoin dominance falls, we may see momentum build in Ethereum. As liquidity moves from Ethereum into the larger cap projects, we may see an altseason looming.
Recommended: Shib has seen close to a 10x rally rally since October.
The Altseason
According to BlockchainCenter.net, “If 75% of the Top 50 coins performed better than Bitcoin over the last season (90 days) it is Altcoin Season”. Simply, the average price appreciation 75% of the top 50 coins within a 90 day period is greater than Bitcoins 90 day average, this is classified as an Altseason. The 90 day moving average for the top 50 cryptos has steadily increased more than bitcoin. Thus lower Bitcoin’s dominance over the market.
Here we can see the average is around 55 out of 100. According to the scale to be in Altseason we need a minimum score of 75. The price appreciate of the top 50 assets are as shown:
As we see the Top 50 moving average increase more than Bitcoins (shown by the chart), altcoin dominance continues to gather momentum. The next leg upward could look like what is classically considered an Altseason.
Could we see a 10 trillion dollar market cap for crypto? According to the graphs above, history and recent trends, it is a definite possibility.
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Text source: CryptosRus
