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Today, 38 out of the top 50 cryptocurrencies have outperformed Bitcoin (BTC) over the past 90 days. As a result, the altcoin season index reached its highest level since January.
This development has stimulated widespread optimism in the market, with many people speculating that the prices of these altcoins could rise even higher in the coming months. But is this possible?
Altcoins Take Over, but Analysts Differ on Reasons for Soaring
For those unfamiliar, the altcoin season index provides real-time insights based on the performance of the top 50 cryptocurrencies relative to Bitcoin. Usually, when the index reaches 25, it means Bitcoin is dominant. It also indicates that Bitcoin has surpassed at least 75% of the top 50 coins.
Conversely, when the Altcoin Season Index reaches 75 or higher, it signals the beginning of an altcoin season. In this case, most of the top 50 assets outperformed BTC. Currently, the index is at 78, confirming speculation that altcoins could continue to outperform BTC in the coming months.
This level marks the highest since January 22. During that period, altcoins maintained strong performance until March, when their dominance declined. In the current cycle, TinTucBitcoin notes that Stellar (XLM), Hedera (HBAR), and Ripple (XRP) are leading the way.
However, Ki Young Ju, CEO of CryptoQuant offers a different perspective on the current altcoin season. According to him, this period is not primarily driven by liquidity flows from Bitcoin.
He believes the main factor is the increased accessibility and usage of stablecoins and fiat currency pairs. This change suggests that new capital pouring into the market may be boosting altcoin performance.
“Altcoin season is no longer defined by asset transfers from Bitcoin. The surge in altcoin trading volume is not led by BTC pairs but by stablecoin and fiat pairs, reflecting real market growth rather than asset turnover,” Ki Young Ju emphasize on X.
But crypto analyst Rekt Capital seems to have a different view. On November 30, the analyst pointed out that the decline in Bitcoin Dominance, currently around 56%, shows that money is flowing into Ethereum (ETH) and other altcoins.
“Bitcoin swings between $91K and $100K could be the formula for Ethereum to take the lead and allow inflows into smaller altcoins,” Rekt Capital write.
Analysis Suggests Higher Growth for Altcoin Market Cap
Analysis of TOTAL2, an index measuring the market capitalization of the top 125 altcoins, shows a bullish flag pattern forming on the 3-day chart.
The bull flag pattern is a bullish chart pattern characterized by two price increases interspersed with a short period of consolidation. It begins with a sharp price increase, known as a “flagpole,” when buyers overwhelm sellers. This is followed by a decline in price, forming a “flag” with parallel upper and lower resistance levels, indicating the possibility of the uptrend continuing.
With this pattern, TOTAL2 has the potential to go much higher than 1.45 trillion. If so, many altcoin prices could surpass their all-time highs.
However, if Bitcoin Dominance returns to 60%, the altcoin season could retreat, and this forecast could be invalidated.
Meanwhile, Doctor Profit, a famous cryptocurrency analyst, agrees that an altcoin season is approaching. In a recent post on X, he predicted that the rest of this year and the first quarter of 20245 could bring higher prices for altcoins.
Going beyond the technical outlook, the analyst points to the lack of strong institutional entry into Ethereum as a bullish signal. He also highlighted rumors that asset managers BlackRock and JP Morgan may be planning an XRP ETF — a development that could add to the pace of the altcoin season.
“There are big rumors right now that BlackRock and JPMorgan are planning to launch an XRP ETF, and this is not just big, it’s HUGE. We are at the beginning of Altseason, and anyone not paying attention will be left behind,” Doctor Profit explain.
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