On previous occasions, low exchange flows preceded significant increases from Altcoins.
Traders expect the Altseason as they usually grant great profits.
The cryptocurrency market shows signals that some analysts interpret as early indications of the start of an Altseason.
According to the axel analyst Adler Jr., the average monthly altcoins exchange flow located at 1.6 billion dollars as of June 27. This figure is below the annual average of 2.5 billion dollars, which suggests a phase of asset consolidation.
In previous cycles, when the flows fell below the threshold of the 2.5 billion dollars, Altcoins prices tended to rise marked shortly after.
In the following graph, shared by Adler, three moments are observed in the last two years where the flows descended below the monthly average: early 2023, the second half of that year, and between August and September 2024.
As observed, in each case, the contraction was followed by a Significant recovery of the Altcoins market. This historical behavior feeds the expectation of a new cycle of accumulation that could precede an expansive price phase.
The Altseason is an event that usually generates interest among traders, due to the profit opportunities it offers. It is considered that there is a season of Altcoins if, in the last 90 days, 75% of the 50 main currencies for market capitalization (not including stablecoins) exceed Bitcoin (BTC) in performance
In previous cycles, Altcoins such as Shiba Inu (Shib) or Dogecoin (Doge), They came to multiply their value. For example, in October 2021, Shib increased 9,200%. And recently, between September and December 2024, Doge increased 370%.
However, not all market participants share the same level of optimism on this occasion.
Not everything is rose color
Unlike previous stages, the current context presents conditions that could hinder the development of a traditional Altseason. Bitcoin, which leads the market with a 65% dominance so far, has shown a pattern of frequent corrections After the recent increases to historical maximums.
As can be seen in the following graphfor almost two months BTC has been quoting on the USD 100,000, and in that, the volatility of the asset has been remarkable, lateralizing between that price and the USD 110,000. In some cases, there have been steep up and down.
The foregoing, according to the Glassnode analysis firm, is a high -risk area, due to a clear weakness of the price to cash, as well as cautious derivatives and capital flows of institutions in decline, as cryptonotic reports.
This behavior generates an environment of uncertainty that affects the Altcoins with greater intensity. According to Crypto Dan, pseudonym of an analyst from the firm, Cryptoquant, in this phase “it is almost impossible to find investors who obtain profits with Altcoins.”
In parallel, the performance of the Altcoins against Bitcoin It also reflects a season dominated by BTC. In the last 90 days, only 20% of the 50 main altcoins – without counting Stablcoins – have exceeded Bitcoin’s performance, as seen below:
This percentage is well below the threshold of 75% that is usually used as a reference to declare an Altseason, according to Blockchain Center criteria. Since January, just ten cryptocurrencies have managed to overcome BTC in performancewhich reinforces the fact that there is a Bitcoin Season Ongoing.
The extinction of the Altcoins?
The disparity in the performance between the Altcoins and Bitcoin also feeds a debate on the future viability of many alternative cryptocurrencies. David Battaglia, market analyst, argues that this cycle could mark the extinction of a large amount of alternative cryptocurrencies.
In his opinion, the market has matured and demands solid foundations that many Altcoins do not have. In previous cycles, prices rose in block, without considering the viability of the project. Now, says Battaglia, they will only survive those proposals that offer useful and differentiated products.
He adds that many Altcoins imitate Bitcoin with similar proposals, such as XRP, Cardano (ADA) or Ethher (ETH), but qualifies these initiatives as failed since its conception. “All coins that seek to make a better BTC are scams from day 1,” he said.
This vision is shared by relevant figures in the sector. Cathie Wood, CEO of Ark Investments, recently said that “most cryptocurrencies will die” and that only three They could consolidate in the long term: Bitcoin, Ethher (ETH) and Solana (Sol).
For Wood, the market is purifying naturally and only projects with robust technological and economic structures will be standing. Its reading points to a more selective and less speculative scenario, in which the mere existence of a cryptocurrency does not guarantee its permanence.
The story is not repeated, but rhyme
Although there are alerts around the Altcoins and their yields are minimal with respect to Bitcoin, this does not mean that an Altcoins season is not in full gestation, because, the story is not repeated, but generally rhyme. Indeed, current conditions make up another upward period for alternative cryptocurrencies to Bitcoin.
According to Dan, from Cryptoquant, it is feasible that there is a new impulse for Bitcoin. This, in turn, It could generate space for a recovery of the Altcoinsalthough on a smaller scale than in previous cycles.
“It is not yet time to abandon hope. Since we are already in the second half of the cycle, it is worth waiting for the next Bitcoin ascending movement,” he said.
From this point of view, the Altseason would not be ruled out, but it would be different. Agustín Nátoli, specialist of the cryptocurrency ecosystem, considers that “Bitcoin will rise more than the Altcoins” and that it is unlikely that a true Altseason will occur in this cycle, as cryptootics reported. In their analysis, the highest risk assets are not being favored by investors, that prefer to concentrate on coins with greater capitalization and liquidity.
In general, the market shows a combination of technical and structural factors that open the door to opposing interpretations. On the one hand, the descent in the exchange flows to Altcoins could represent an opportunity for accumulation, as happened in the past. On the other, the current domain of Bitcoin, the lack of performance of the Altcoins and the negative perception of the viability of many of them, They suggest a less propitious environment for recovery.
The evolution of the cycle will mark the course. If Bitcoin reaches new maximums or consolidates at high levels, as large entities such as Standard Chartered have predicted, it could release part of capital towards other digital assets.
However, the selection will probably be more rigorous than in the past. Those Altcoins without clear foundations will face difficulties in capturing attention and investment. The expectations of an Altseason could be met, but perhaps not in traditional terms.
