What is Altseason?
"Altseason" refers to a phase in the cryptocurrency market cycle where numerous altcoins experience rapid price appreciation against Bitcoin. A classic example occurred between late December 2017 and early January 2018, when altcoins entered a frenzied bull market.
This brief altcoin rally is a double-edged sword—offering life-changing opportunities for some while leading others to significant losses. For many retail investors, catching this fleeting window represents hope for financial mobility, especially as Bitcoin's $35,000 price point becomes prohibitive.
When altseason ends, Bitcoin typically reasserts dominance, leaving altcoins vulnerable to catastrophic declines—a phenomenon dubbed "Salt Season." How can investors navigate this high-stakes timing challenge?
Cryptocurrency Sector Rotation Dynamics
Cryptocurrency markets exhibit cyclical sector rotation patterns. Fund flows typically progress through four distinct phases during bull markets:
Phase 1: Bitcoin Leads
- Initial capital inflows (both from within and outside crypto) drive Bitcoin's price surge
- Ethereum begins gaining traction but initially lags behind Bitcoin
- Critical inflection point occurs when Ethereum's growth rate surpasses Bitcoin's
Phase 2: Ethereum Takes Center Stage
- Ethereum outperforms Bitcoin in price action
- Narratives emerge about Ethereum's long-term potential eclipsing Bitcoin
- Capital starts flowing toward major altcoins (top 20 by market cap)
Phase 3: Major Altcoins Rally
- Ethereum maintains superiority over Bitcoin
- Top 50 cryptocurrencies experience explosive growth
- Fundamentally strong newer altcoins gain attention regardless of market cap
Phase 4: Altcoin Frenzy
- Quality blue-chip tokens repeatedly break all-time highs
- Mid, low, and micro-cap coins surge simultaneously
- Meme coins proliferate amid market euphoria
- Blue-chip altcoins dramatically outpace both Bitcoin and Ethereum
What Follows Altseason?
Post-altseason, capital typically exhibits two behaviors:
Profit-Taking into Fiat
- Investors convert massive altcoin gains to fiat currency
- Large-scale sell-offs often trigger market corrections or full-blown bear markets
Capital Recycling into Bitcoin
- Altcoin profits flow back into Bitcoin, reigniting its momentum
- This initiates a new "bull cycle" where funds gradually trickle down to Ethereum → major altcoins → smaller altcoins
Is Altseason Here Now?
Recent developments show promising signs:
- UNI, SUSHI, and other DeFi tokens have surged
- Bitcoin's market dominance dipped from ~70% to 67%
- Altcoin market cap is rising—though still below 2017's peak
According to BlockchainCenter's definition, altseason requires 75% of top 50 cryptocurrencies outperforming Bitcoin. Current data suggests we're in early stages rather than full altseason:
| Timeframe | Outperform BTC | Underperform BTC |
|---|---|---|
| Past 90 Days | 18 | 31 |
| Past Year | 19 | 20 |
| Past Month | 23 | 26 |
The current rally remains concentrated in DeFi rather than market-wide, but the trend is emerging.
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Predicting the Next Full Altseason
Examining 2017's altseason reveals key patterns:
- Bitcoin's rally set the stage (post-China's "94" ban)
- ETH surged from $351 to $1,400 between November-January
- Altcoin mania peaked December-January alongside ETH's rise
- The ICO boom drove unprecedented Ethereum demand
2021's landscape differs significantly:
- Institutional Bitcoin buying provides price stability
- DeFi ecosystem growth and Polkadot parachain auctions fuel new altcoin narratives
- Weak Bitcoin dominance (<66%) remains prerequisite for altseason
Potential triggers for current cycle:
- Bitcoin consolidation around $34,000
- Ethereum breaking all-time highs
- Sustained Bitcoin dominance below 66%
- Expected duration: 1-2 months if triggered
FAQ: Navigating Altseason
Q: How can I identify altseason starting?
A: Monitor Bitcoin dominance charts and track when 75%+ of top 50 coins consistently outperform BTC.
Q: Should I sell all my Bitcoin for altcoins during altseason?
A: Maintain portfolio balance—most professionals recommend keeping significant Bitcoin exposure even during alt rallies.
Q: What sectors typically lead during altseason?
A: Historically DeFi, metaverse tokens, and infrastructure projects gain early momentum before spreading market-wide.
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Final Thoughts
Altcoins resemble seductive sirens—promising wealth but often leading to ruin. While Bitcoin may seem "boring" comparatively, its reliability has consistently rewarded long-term holders. Successful altcoin investing requires:
- Technical skill to identify genuine opportunities
- Emotional discipline to exit positions strategically
- Balanced portfolio construction
Remember: What goes up exponentially during altseason often comes down even faster.
Disclaimer: This content represents market observations only, not investment advice. Always conduct your own research before trading.