Is copycat season almost over? Hartmann Capital warns: Institutions are accelerating profit-taking, and the subsequent decline will be severe

Since Donald Trump's election victory, the altcoin market has seen a significant surge, but Felix Hartmann, managing partner of Hartmann Capital, recently tweeted a warning that as institutional investors increase their profit-taking activities, the market may see a correction in the near future. Felix Hartmann shared a chart indicating that the altcoin season may have already ended, with the annualized funding rates of most altcoins exceeding 100%, and the recent rally being primarily driven by perpetual contract trading, while spot trading volume is declining, and the subsequent downtrend could be quite severe: "Traders may remain irrational, but we are at a stage where teams and VCs are starting to become more aggressive in taking profits, and once the momentum shifts, the market will have to delever, and we'll see some murder-suicide type of drops." CoinMarketCap data shows that among the top 100 cryptocurrencies, the top three altcoins with the highest gains since November 1st are HBAR with a 99.31% increase, IOTA with a 79.61% increase, and JASMY with a 72.47% increase. Cointelegraph reported that in 2021, the altcoin market experienced significant rallies, only to see substantial declines within a few months, such as SOL, which reached a high of $248.36 in November 2021 but then plummeted 64% to $89 by January 2022, and XRP, which also crashed around 51% during the same period. While Felix Hartmann has issued a warning, other cryptocurrency traders believe that this is just the beginning of the altcoin season, and anonymous trader Mikybull Crypto recently analyzed that the altcoin season typically lasts around 90 days, suggesting that it could continue from this month until March next year. The market often uses Bitcoin's market dominance decline as a key indicator of the start of the altcoin season, and CoinMarketCap data shows that Bitcoin's dominance has decreased from 58.6% 30 days ago to 54.4% currently, while the dominance of the remaining cryptocurrencies, excluding Bitcoin and Ethereum, has risen from 27.6% to 32.6% during the same period. However, it's worth noting that CoinGlass data shows that the 30-day funding rates for most altcoins are currently between 2% and 6%, meaning that long positions need to pay 2% to 6% per month to maintain their leveraged positions. Although these costs seem manageable in a strong uptrend, if the prices stagnate or decline, they could quickly erode traders' profits.