The Market Is in the Early Stages of Altcoin Season

A recent report from wealth manager Swissblock and insights from other analysts conclude that the crypto market is entering the early stages of an altcoin season.

Although Bitcoin dominance remains high, experts believe the market situation will shift quickly. This article delves into the reasoning behind these claims.

Early Signs of Altcoin Season Emerge

Altcoin Vector, Swissblock’s institutional-grade altcoin market report, recently stated that the altcoin season has begun. Their team asserts that the market shows clear signs of capital rotation from Bitcoin into other altcoins.

This isn’t merely speculation. It’s supported by two key indicators used by Swissblock: Impulse and Structure, both of which help track market trends.

Impulse, which measures the percentage of altcoins showing exponential strength, is signaling a shift. Since June, only 8% of altcoins have shown negative momentum. Historically, market bottoms form when this number falls between 15–25%.

Therefore, Swissblock believes the altcoin market has likely bottomed out.

Structure evaluates whether the market is in a breakout position. The analysis highlights that the altcoin market cap (TOTAL2) has broken out with a 22% increase. Past data shows such breakouts often lead to market cap gains between 67% and 96%.

“We’re in the early stage of altseason. And our framework says it’s not a matter of if or when — it’s a matter of how intense.” – Altcoin Vector concluded.

A recent report by BeInCrypto reinforces Swissblock’s conclusions. It notes that Bitcoin dominance dropped from 66% to 64%, even though Bitcoin reached a new all-time high. This indicates that altcoins are gaining market share faster than Bitcoin.

Altcoin Season Index Hits Highest Level Since February

The Altcoin Season Index stands at 35, its highest since February. According to this index, an official altcoin season begins when 75% of the top 50 coins outperform Bitcoin over the last 90 days.

Although it hasn’t reached the 75 threshold yet, the recent spike to 35 is significant. It’s a strong improvement over the past four months and has fueled growing optimism.

Several analysts have grown more confident in this prediction. TechDev, a well-known analyst, believes the altcoin market has been suppressed for four years and is now ready to break out. Meanwhile, Michaël van de Poppe emphasizes that this is the best time to buy altcoins and take profits over the next 12 to 24 months.

Still, Nicolai Sondergaard, a Research Analyst at Nansen, warns that even if an altcoin season happens, it may not resemble previous ones.

“I think it’s hard to say whether the much-awaited altseason will actually bless us at this time. BTC dominance remains high at 64.59%. Although it has been flattening somewhat, likely due to capital flowing into ETH, SOL, and HYPE as some of the major players, that doesn’t necessarily imply that funds will trickle down into alts as they have in previous cycles. One of the key challenges facing the altcoin market today is the saturation of tokens,” Nicolai Sondergaard told BeInCrypto

At the time of this writing, the altcoin market cap (TOTAL3) reached $933 billion, a more than 14% increase since the beginning of July.