July 21, 2023
There is a lot of talk about the altcoin season, also known as altseason, coming back to markets soon. Crypto experts have their various opinions on when exactly we will see it return. In the meantime, however, this helpful article will give you the basics of altseason so you can spot the indicators and prepare your portfolio.
Altcoin season is a period when money flows out of Bitcoin and into altcoins. It results in a significant and rapid increase in their value. The Altseason happens when Bitcoin dominance decreases. It refers to the percentage of Bitcoin's total cryptocurrency market share. This leads to an increased investment in other cryptocurrencies, called altcoins.
Altseason is a rewarding but rare period for crypto traders. The season offers a big opportunity for potential large returns. By capitalizing on the price movement, it is possible to earn a large profit. It also helps diversify your portfolio.
Suggested reading: 7 Tips to Diversify Your Portfolio Today
Moreover, altcoins have the potential to outperform Bitcoin (BTC). So you should stay informed and seize the moment. This might be your opportunity in your crypto trading journey.
It is important to understand what drives Altseason. By understanding the factors behind it, you can plan your strategies better. That is how you make the most of Altseason in trading and investment.
Here are 4 key indicators of Altseason:
The most common way to look for altseason signs is by looking at the Bitcoin dominance chart. When Bitcoin dominance starts to decrease, it means more people are selling Bitcoins. This can be a sign of the start of Altseason, where altcoin prices rise sharply. But when Bitcoin dominance increases, there might be a low chance for the Altseason to happen.
The market capitalization of altcoins is the total value of all altcoins combined. You can analyze and compare historical data with current market conditions. There, you can find similarities in the patterns. It often follows previous market cycles. These patterns involve periods of both growth and decline. Thus, you can make predictions on future trends.
Another way to predict the upcoming Altseason is by watching the Ethereum (ETH) price movement. The performance of Ethereum is what drives the entire altcoin market. The key indicator is when ETH starts to separate from BTC. It is an obvious sign when BTC's value is declining while ETH's is increasing.
It is usual that traders often get carried away when trading. Even after making calculations, the market movement may sway their emotions. As a result, there are many cases where traders make irrational trades.
Traders can get over-excited about making profits when the market goes up. But when it goes down, they often panic sell. To avoid this common mistake, you can check the market sentiment indicator.
Some examples of the providers are Crypto Fear and Greed Index. But, they do not directly show the altcoin season. It is only used to broaden your understanding of what to expect from the cryptocurrency market.
The Altcoin season index is a tool that helps us determine our position concerning Altseason. The index shows the historical trends in a graph over monthly and yearly periods. It also provides insights into whether Altseason is currently happening or not. We can consider Altseason is underway when the performance of other coins is 75% better than Bitcoin in the last 90 days.
To decide which altcoins that's best to invest in, you should do your analysis and research. There are some factors you can take into account before making investments in altcoins.
But you should remember that investing in cryptocurrencies involves risks. The altcoin season and market trends can change rapidly, making it highly volatile.
Here, we cover some altcoin alternative recommendations based on expert analysis and market capitalization.
ETH is a utility token for executing transactions in the Ethereum blockchain platform. It operates without a central authority and enables secure and transparent transactions. Developers also use it to create smart contracts and decentralized applications (dApps). There is a debate about the classification of ETH as an altcoin. It is because Ethereum has positioned itself as a prominent blockchain for smart contracts. ETH market cap is the biggest among altcoins. The current market cap is $225.75B.
Binance Coin is also a utility token. You can use it to pay trading fees and enjoy discounts on the Binance exchange. BNB facilitates payments outside the platform as well. BNB's current market cap is $38.68B.
Some consider XRP as a unique type of cryptocurrency. People think it is different from the traditional ones because XRP does not have the same decentralized nature. XRP is a digital currency used on the Ripple network. It makes international money transfers fast and low-cost. The current market cap stands at $25.02 billion.
Cardano is a blockchain platform, while ADA is the native token of Cardano. ADA has achieved faster transaction speeds. It results in a more efficient and streamlined transaction on the Cardano blockchain. The current market cap stands at $10.23 billion.
Solana started its operation in 2020, making it a relatively new cryptocurrency. The platform is similar to Ethereum. People use it to create decentralized apps as well as smart contracts. You can also use Solana to make quick and secure transactions. Moreover, it can be one of your affordable choices. Solana is one of the fastest blockchains that exist. The current market capitalization of Solana is $8.87 billion.
Historically speaking, altcoin season is a 3-month period of significant altcoin growth. The next one is not here yet, so it’s the perfect time to start preparing. Click the button below and buy your favorite altcoins before altseason hits us!
Disclaimer: “The content should not be construed as investment advice and does not constitute any offer or solicitation to offer or recommendation of any investment product. It is made available to you for information and/or education purposes only.
You should take independent investment advice from a professional in connection with, or independently research and verify any information that you find in the article and wish to rely upon.”
Editor-in-Chief of the YouHodler blog. Connect with him about writing techniques, cryptocurrency, and music.
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YouHodler is regulated in the EU (Italy) and Switzerland, and does not have a regulated UK entity. YouHodler is NOT regulated by the FCA, and protections offered under UK law do not apply.
YouHodler promotions are not targeted at UK investors, and bonuses or loyalty programs like the rewards programme or sign-up offers will not be available to residents of the UK. You can learn more about the services offered to UK customers here.
Do not invest with YouHodler unless you’re prepared to lose all your money or tokens invested. Crypto Currency is considered as a speculative and high‑risk investment and you are unlikely to be protected if something goes wrong. Take 2min to learn more about risks.