The crypto market moves between periods of Bitcoin dominance and altcoin surges. These different types of phases provide opportunities for traders to invest. One such phase is Altcoin Season, which is the phase when some major altcoins outperform Bitcoin in terms of profit.
Altcoin Season Index is a tool that highlights this phase by using various indicators. It shows when major altcoins are performing better than Bitcoin over a specific period of time. This tool helps investors in making the right decision related to crypto investment. Let’s explore:
What is Altcoin?
Altcoin is a term used in the crypto market to refer to cryptocurrencies other than Bitcoin. It was used to differentiate between BTC and Other crypto assets. These coins offer alternatives with unique features like fast transactions, high scalability, etc. Some of the major altcoins include Ethereum, Solana, Cardano, XRP, SUI, etc.
What is Altcoin Season?
Altcoin or Altseason is a phase in the crypto market where crypto tokens other than Bitcoin perform better in terms of price rise. This price surge mainly occurs when investors are exploring new opportunities in the crypto market.
During this Altseason, the capital flows from Bitcoin to other altcoins, resulting in a price surge. For example, in 2017-2018, the dominance of Bitcoin went down from 86% to 38% while altcoins like Ethereum, XRP, etc have seen a massive surge in their price.
This season is characterized by high market volatility and an increase in trading volume. At this time, investors focus more on altcoins due to their strong potential for higher returns, especially when the price of Bitcoin is stable or grows at a very slow pace. However, Altcoin Season is also filled with risks because at this time, there are high price fluctuations, which may lead to financial breakdown.
What is the Altcoin Season Index?
The Altcoin Season Index is a market tool that measures how altcoins are performing as compared to Bitcoin. It uses the data of the top 50 altcoins and checks their prices and growth in the last 90 days against Bitcoin performance.
This index does not predict the future of altcoins, but their recent price movement. It uses a score from 0 to 100, where a high score means that altcoins are doing better than Bitcoin. It is mainly used by investors to track changes in the market conditions between Bitcoin and other cryptocurrencies.
This Altcoin Season Index is regularly updated and available on various crypto analytical websites like CoinMarketCap, etc. It simplifies the complex market data into a very easy score, which is beneficial for new investors to decide on their investment strategy.
How Does Altcoin Season Index Work?
The Altcoin Season index checks the performance of top 50 altcoins relative to Bitcoin over 90 days. It measures the percentage of top altcoins outperforming Bitcoin. For example, if 75% or more of Altcoin’s price perform better than Bitcoin then it is called Altseason.
For instance, if 15 altcoins out of the top 20 Altcoins are doing better then the index would read 75%, which signals an Altcoin Season and if only 5 altcoins outperform Bitcoin then the index would read 25% which shows the Bitcoin dominance.
When Will the Next Altseason Start?
The start of Altseason depends on the performance of major altcoins in the last 90 days. According to analysts, the next Altseason is predicted during Q4 of 2025 which aligns with historical patterns observed after the Bitcoin halving event. After the 2024 halving event we have seen a surge in Bitcoin dominance, but recent data shows a shift.
A decline in Bitcoin dominance below 50% shows a surge in altcoin activity, which marks the start of Altseason. Currently, Bitcoin dominance is around 64%, and if it declines further, then it could be an altcoin rally.
According to the CMC Altcoin Season Index, currently we are in Bitcoin Season, but last month the index ranking increased from 14 to 25, which highlights the upcoming of Altseason in the near future. Further, the ETH/BTC pair’s performance is very important and a breakout here often leads to altcoin surges. Hence, we can expect the altcoin season very soon, which will provide investors with an opportunity to diversify their portfolio.
Strategies to Follow During Altcoin Season
Below are some basic strategies to follow during Altseason:
Diversify Portfolio
During Altseason, there are various tokens that are doing better, and hence, there is a need to diversify the portfolio with multiple tokens and avoid putting all funds into a single token, which reduces risk and increases chances of better returns.
Set Clear Entry and Exit Targets
To play smartly, an investor must define their buy-in and sell-off levels in advance. They should stick to the targets and avoid emotional decisions during a price surge.
Follow Market Trends and News
For better decision making during altseason, an investor must stay updated with crypto news, project development, social media sentiments, etc. This will reduce chances of financial loss which is backed by fake news and rumours.
Take Regular Profits
During a price rally, investors should gradually take profits and not wait for the perfect top. This type of strategy ensures that an investor gains even if the market drops suddenly.
Be Cautious of Hype and Scams
The Altcoin Season attracts hype-driven projects which may also be a scam or a rug pull. Hence, do your own research and invest only in tokens which have transparent teams.
Final Thoughts
Altcoin Season is a good time for investors, which provides an opportunity to maximize profits beyond Bitcoin. By understanding the Altcoin Season index and by following smart investment strategies, traders can make better decisions, which will be helpful in extracting profits during Altseason. However, be cautious, as it all comes with risk, so DYOR (Do Your Own Research) before investing during the season to avoid financial loss.
