Alt season is a period in the cryptocurrency market when altcoins (alternative cryptocurrencies other than Bitcoin) show higher growth compared to Bitcoin. During such periods, their market capitalization and value increase significantly, which attracts both large investors and retail players. Alt season is an important event for traders and investors, as it opens up opportunities for high profits on the growth wave.

Alt season occurs when Bitcoin's dominance declines and capital flows into altcoins. This may happen because investors start looking for more yield and switch to smaller crypto assets that have not yet reached their peaks, as is the case with Bitcoin.

When to expect the altseason?

Predicting the exact dates of the altseason is difficult, but there are a number of signs that indicate that it is approaching. Historically, altseasons are most often observed after a significant increase in Bitcoin or during corrections when investors are looking for alternatives. The highest probability of an altseason usually occurs when Bitcoin reaches a new high and begins to lose dominance.

Early signs of the altseason approaching

Bitcoin Dominance Declines

One of the key signals that the alt season is approaching is a decrease in the share of Bitcoin in the total cryptocurrency market capitalization. Bitcoin dominance reflects its market share relative to other cryptocurrencies. Usually, when Bitcoin's share starts to fall, it means that investors are switching their attention to altcoins. If Bitcoin's share drops below 40-50%, it can be an early signal that the alt season is starting.

Growth of major altcoins (Ethereum, Binance Coin)

Before the overall altcoin market starts to rally significantly, it is usually the larger cryptocurrencies such as Ethereum (#ETH ) and Binance Coin (#BNB ) that rise first. This is because the larger altcoins have the most institutional attention and their growth is perceived as more stable and less risky. The rise of these coins may indicate that capital is beginning to flow from Bitcoin to altcoins.

The DeFi and NFT Sectors Are Growing

Two important areas that have already caused several mini-alt seasons in the past are the DeFi and NFT sectors. If interest in decentralized finance (DeFi) and non-fungible tokens (NFTs) increases again, this could trigger an increase in the capitalization of the altcoin market. Examples of such periods are the sharp rise of DeFi tokens in 2020 or the NFT boom in early 2021.

Increase in social media activity and search queries

One of the early indicators of interest in altcoins is an increase in activity on social media sites like Twitter and Reddit. If popular crypto communities see an increase in discussions about altcoins, especially smaller and lesser-known ones, this may be a harbinger of increased demand. It is also worth paying attention to search trends. For example, if search queries such as “buy ETH,” “altcoins 2024,” and “best altcoins” start to rise sharply, this may indicate investors are willing to invest in altcoins.

Bitcoin Volatility Declines

When Bitcoin enters a consolidation phase, its volatility decreases and traders begin to look for more profitable assets. Bitcoin price stability often means that the market is ready to move towards altcoins. During such periods, demand for altcoins can increase, especially if there is no negative news in the market.

Increase in trading volumes on major exchanges

A sign of the beginning of the alt season may be an increase in altcoin trading volumes on major crypto exchanges such as Binance, Coinbase, and others. When altcoin trading volumes increase sharply, this may indicate increased interest in them from major market participants.

Examples of past altseasons and their characteristics

  1. Altseason 2017

    As Bitcoin surged in 2017, its market dominance waned and altcoins began to show impressive results. Ethereum rose from $8 to $1,400 during the year, while Ripple (XRP) peaked at $3.84. This was the first major alt season that demonstrated the significant potential of altcoins.

  2. Altseason 2021

    In early 2021, after Bitcoin rose to a new high ($64,000), capital flowed into altcoins. Ethereum rose to $4,000, Cardano (ADA) reached $2.46, and Binance Coin reached $600. This alt season was fueled by the NFT boom and the rise of smart contract projects like DeFi.

  3. Mini Altseason 2023

    In the summer of 2023, after a period of stagnation in Bitcoin, attention shifted to memecoins and AI-related projects. Tokens such as PEPE and LADYS attracted significant interest and provided short-term growth for certain altcoins.

What to look out for in 2024?

Analysts suggest that the next full-fledged alt season could come in 2024, especially if there is another massive adoption of cryptocurrencies. Important factors that could influence the alt season include:

  • Regulatory changes: New regulations could change investor preferences and spur altcoin growth.

  • Technological upgrades: If major networks like Ethereum and Cardano release significant upgrades, it could attract capital to them.

  • Growing interest in Web3 and the metaverse. If Web3-related projects gain mass attention, this could also initiate an altseason.