Altcoin season or the replacement of Bitcoin is a period when the cryptocurrency market witnesses an explosion of Altcoins, with superior growth rates, high FOMO sentiment, and creating attractive profit opportunities for investors. This is the time when all tokens (except BTC) simultaneously experience strong price increases, far exceeding the performance of BTC.
Read more: What is Altcoin Season?
Signs to Recognize
To be able to sniff out the timing of the Altcoin season, here are 2 common signs:
- Bitcoin Dominance (BTC.D): This index reflects the influence of BTC on the entire market, and a decrease in this index can also be a factor leading to the Altcoin season. However, it also needs to be monitored to meet a few other factors. It is important to note that BTC.D is a continuously changing statistic based on other indicators.
Read more: What is Bitcoin Dominance?
- Ethereum's performance is particularly outstanding (especially compared to BTC): Typically, the explosive phase of Altcoins will begin after BTC enters an accumulation (sideways) phase after a strong price increase, and Ethereum shows superiority over BTC.
Altcoin Season May Still Become a Reality in This Year's Uptrend
First and foremost, the US Presidential election has been completed with a convincing victory for Mr. Donald Trump, a passionate supporter of ideas related to cryptocurrencies. Through speeches, tweets, and various media, he and his trusted billionaire Elon Musk have expressed their vision for the development momentum of crypto.
As a result, ideas related to blockchain technology and cryptocurrencies will become more open and have more room for development this season.
Furthermore, with the policies expected to be crypto-friendly under Mr. Trump, the first beneficiary will be $BTC, which will continue to break through to new ATHs (it has already reached the $93K level). This rapid growth is also expected to increase as FOMO gradually subsides and shifts to other coins.
Another factor leading to the prospect of an Uptrend season is the new sources of liquidity awaiting the traditional financial and crypto markets, such as interest rate cuts, FTX paying off creditors, China showing signs of relaxing regulations on crypto, and continuous Mint on various chains.
Read more: Where Will the Liquidity for the Crypto Market in Late 2024 Come From?
So, even though we know that the Uptrend and Altcoin season will see the coins "soar", will that be the case for all coins, especially when the number of coins created every day is constantly multiplying?
Is Altcoin Season for All Coins?
Right now, a slew of Launchpads or token-creating protocols are developing rapidly, leading to a tremendous growth in the number of tokens (especially MEME coins). According to Step Finance, there are over 19 million tokens created on the Solana ecosystem alone in the past month.
Therefore, allocating funds to all coins during the Altcoin season to have them all rise is virtually impossible. If this were to happen, the capital would become fragmented and unable to experience strong growth.
Earlier this year, the performance of projects listed on Binance was relatively low. This stems from many factors, but mainly from listing with low supply and high FDV, along with the "scandal" of Binance demanding a huge listing fee.
Read more: Do Projects with Low Circulating Supply and High FDV Have Opportunities?
As a result, tech coins that seem very promising have yet to recover their position at the time of the TGE. This performance has been somewhat disappointing for investors, especially when compared to MEME coins.
MEME coins are driven entirely by the community and manipulation by the house. It offers the potential for huge profits, but can also easily cause "gamblers" to lose everything. For the time when a large influx of capital is poised to enter the market, investors tend to gravitate towards risky investments with the potential for short-term high returns. This is why MEME coins have been increasingly attractive in recent times.
A few typical examples: $PEPE (+2200%), $BONK (+380%),…
Thanks to their high profitability, MEME coins have become an extremely promising investment area, reflecting the true culture, operation, and quick responsiveness to the global market situation. Holding the top coins and coins pegged to the influence of a few names like Elon Musk and Trump can easily generate good returns.
Although the profits that memecoin brings are truly very good, it is the technology that creates the crypto market, for example, because this is what can be drawn upon to justify the best price increase, not just like memecoin "based on culture". In fact, technology Altcoin is still the foundation for the development of crypto.
Therefore, there is a high probability that there will be a selection to push the Altcoin wave according to each Narrative or individual ecosystem instead of pushing the entire market like Altcoin season 2021.
Read more: The upcoming Alt season - choose Memecoin or Technology coin?
The technology coin Narrative that is most likely to benefit when there is an Altcoin Season\
Every year, ETH always has an update (The Merge, Pectra, Shapella,...) and it also coincides with the timing of Altseason -> Opportunity for techcoin led by ETH is still there.
- Ethereum Ecosystem: It once led the Uptrend wave of the 2021 market with the "Defi Season", the Ethereum ecosystem still holds the key to leading the Uptrend season this year. Narratives are gradually maturing and can benefit from government policies such as RWA, Restaking, LSD,...
- GameFi: In Altcoin season 2021, GameFi once pumped before continuing to have a strong wave at the end of 2021, reflecting the huge demand for the development of this ecosystem. The Ronin Blockchain seems to have many plans for the TGE timing of projects in the ecosystem. This raises expectations for a special explosion for this piece.
- AI: Elon Musk is a strong supporter of AI ideas. Parallel to this is the positive reaction of major players in the traditional market to this field, which shows that the AI Narrative has real potential.
Conclusion
These are the pieces that can easily catch the first inflow of money when the Altcoin season begins. However, as mentioned, the fact that there are too many projects with many different types of cakes is hindering the idea of pushing the wave for all large and small coins in the system. The ideal would be that the strong wave only occurs for projects that are truly quality and have real users and revenue, projects that are top Narrative or closely linked to the global development situation.
Example: Rumors that the CEO of the ADA token may be appointed as an advisor under President Trump have helped the token grow impressively.
Read more: Projects that provide real value are still the future of the crypto sector
Summary
Allinstation has answered the question of whether "Altcoin season is for all coins?". Brothers, please explore and evaluate to make the most prudent investment decisions. Good luck!!!
