Key Insights:
Crypto markets see the domination of Bitcoin (60%) rise to multi-year highs when the markets expect an alt season.
The Altcoin season index shows a value of 33 which is closer to a Bitcoin season.
The rise of Bitcoin is caused by institutional investment and regulatory issues, which are currently pro-Bitcoin but anti-Altcoin.
Generally, the Altcoin season follows the post-halving rally in Bitcoin.
We expect an Altcoin season to arrive in mid to late 2025.
Altcoins generally follow a pattern where they surge after a post-halving rally in Bitcoin. Since the 2024 Bitcoin halving took place on 20 April, and the Bitcoin Post-Halving Rally happening in November 2024, we should have seen a surge in Altcoins by now.
Altcoin Season Index at 33
Blockchain Center
A look at the Altcoin season index reveals that at 33, we are much closer to a Bitcoin season (<25). This is because of a few major factors, such as institutional investments only in Bitcoin, fair crypto regulations for Bitcoin and Ethereum only, and finally, the rise of adoption in Bitcoin due to its relative simplicity.
At present, the season index shows a skewed market because, out of all cryptocurrencies, only Bitcoin has seen institutional inflows due to a delay in regulation for Altcoins.
Also, Bitcoin is a lot easier to understand, as it is being likened to "digital gold" in the financial markets. At present, it is highly likely that only a fraction of Bitcoin investors truly understand the basic technology. This caused a gold rush to invest in Bitcoins without the picture being clear to investors.
The current rally in the crypto markets is dominated by Bitcoin (60% market cap domination) for the two reasons mentioned above.
The Altcoin season would only arrive with its full momentum once this Bitcoin rally subsides and we see pro-altcoin policy. This is expected to start with the approval of ETFs from Solana and XRP, possibly DOGE too.
Experts from VanEck expect these ETFs to arrive by late 2025 ; hence, we might see an alt season around that time.
An Alt season or Altcoin season is a period of bull rallies in the crypto market during which the gains of Altcoins are generally higher than those of Bitcoin. As a result, Bitcoin's market dominance is decreasing, and that of all Altcoins combined is increasing.
To gauge an Altcoin season, we can compare the Bitcoin gains with those made by the Altcoin markets. Since it is very difficult for an ordinary crypto user to do this complex calculation everytime
To make it simpler, several data aggregators have launched their Altcoin index, which shows the severity of the Altcoin season. It shows a number from 0 to 100. An Altcoin season index that shows a number close to zero signals the Bitcoin season, and if the number is closer to 100, it indicates the Altcoin season.
At press time, the Altcoin season index shows a value of 33, which means we are in a neutral zone (25 to 75) but close to a Bitcoin Season.
Altcoin Season Index
Blockchain Center
At a time when the Altcoins were supposed to be ruling the markets (after a post-Bitcoin-Halving rally), it feels a little weird that the Altcoin season hasn't started yet.
Note: You can continue reading here or jump directly to the next section to understand why this anomaly has occurred.
Besides just seeing the alt season index to check the arrival of the Altcoin season, we can use another direct method to check it.
If, at any given time, the top 50 Altcoins are performing better than Bitcoin, then it can be considered alt season. Though this uses the same logic as above, it gives the reader a simpler and, hence, better understanding of the concept.
Alternate Method to Check Alt Season Arrival
Blockchain Center
The Altcoin season is used to make investment decisions. A clever investor would only buy an asset when it is undervalued, which typically happens when the crypto is in an off-season period.
For example, Bitcoin is relatively undervalued in an Altcoin season and Altcoins are generally undervalued in a Bitcoin season.
To identify these seasons, we use an Altcoin season index. Generally, values above 75 in the Altcoin index signal that an Altcoin season has started and has gained momentum. This means that as time proceeds, the Altcoin markets will see rising momentum in their price and, hence, will gain price until they become overvalued.
An Altcoin's lifespan can be from a few weeks (8 to 10) to several months (12 to 18). This depends totally on various technological and situational factors.
Technological factors, such as Ethereum's upgrades, would negatively impact the usage of Ethereum scaling solutions and cause a crash in the L2 markets.
Situational factors like regulatory issues, legal cases, the macroeconomic environment, and geopolitics also impact the Altcoin markets. In such situations, people flee towards Bitcoin, which is a much safer asset than Altcoins.
The next Altcoin season, which could be the largest to date, is expected to start by mid-2025 and last until late 2026.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.