Is Altcoin Season Here?

It’s the question everyone loves to ask. For anyone who has been around for at least one cycle they’d know that Altcoin Season is the time things get really crazy in the crypto space and the Rising Tide Lifts All Boats (or many of them at least) so easy gains can be made. But what exactly IS Altcoin Season and how would we even know if we’re in one? For me, I like to look at metrics and to answer this question I go to the Bitcoin Dominance chart.

For a quick recap, I am a firm believer in the 4-year cycle and I’ve written about it in the past. If you’re catching up then have a quick read of my post from early 2023 History Doesn’t Repeat but it Rhymes where I cover the last 2 cycles and break them up into 4 distinct phases each lasting about 1 year. I refer to them here as Bull, Bear, Consolidation and Recovery Phases. For those that would remember, 2017 and 2021 were Bull Phases where the crypto market broadly behaved spectacularly and if you have a look at the chart above you’ll notice something important...

During the Bull Phase of the last 2 cycles the Bitcoin Dominance has dropped fairly significantly, while in the Bear and Consolidation Phases the Bitcoin Dominance has increased. The Recovery Phase looks volatile but flat on average. So where are we now and what should we expect to see from here?

I’m am putting us at the end of the Recovery Phase as of about November 2024 when Bitcoin Confirmed it’s Breakout, so I think we are in the early stages of the next Bull Phase...and yes, we are starting to see some action in the Altcoin markets. Over the last 3 weeks we’ve seen Bitcoin Dominance drop from over 60% to under 54% and according to Coin Market Cap we are at about 55.7% today. Now admittedly that is not a huge drop, but it’s certainly a start and the timing lines up.

Now I’m not here to upset the Bitcoin Maximalists, because I do still think that Bitcoin is likely to do well over the next 12 months, I’m just pointing out that at this stage of the cycle that Altcoins often get bid up too...and sometimes by more percentage-wise. I personally think the fundamental reason for this is growing optimism (and greed) in the traders mindset which has them looking for other quick gains elsewhere when Bitcoin comes up against a Key Resistance Level. We currently do have that with Bitcoin pressing up to $100K US and consolidating there.

Meanwhile other Altcoins like HIVE are finally catching a bid. Today HIVE is up over 100% across the last month and as a bagholder here that does make me very happy. However, Altcoins can be extremely volatile and dump just as quickly as they pump so I’m not about to rush into any old Meme Coin. That said, I won’t be surprised to see them pumping like there’s no tomorrow. Do your own research and don’t get shafted like those poor saps who piled into Hawk Tuah Coin last week. The Bull Phase is very exciting but it’s still very easy to lose your shirt if you’re reckless and buying trash.