Following the explosive 2021 Bitcoin and crypto bull run, the expectations of an “altcoin season” have become even more pronounced. This term refers to a period where the prices of altcoins rise rapidly and outperform the Bitcoin price by a large margin. Usually, this happens after the Bitcoin price has put in a new all-time high, and money is rotated into altcoins. However, this has not been the case this cycle. So what happened to altcoin season?
Altcoin Season Has Not Started Yet
Crypto analyst and expert Michaël van de Poppe took to the X (formerly Twitter) platform to share with his over 790,000 followers that the altcoin season has yet to begin. This goes against the widespread belief that the altcoin season has already come and gone, and is officially over. According to van de Poppe, the altcoin market is actually still in a bear market, but it is about to end.
The analyst’s prediction comes as the Bitcoin price remains above six figures, and yet the altcoin market continues to struggle close to its lows. Despite the abysmal market movement and the massive decline in positive sentiment, the crypto analyst still believes that the best is yet to come.
He predicts that the crypto bull market is about to begin, and this would be bigger than ever because the bear market has gone on for so long. Furthermore, he points out that this cycle is different than previous cycles and the next 1-3 years will be different as well. Thus, he predicts many investors will miss it for being impatient.
Using the chart above, which was created by crypto analyst TechDev, van de Poppe shows that the altcoin market is at a pivotal point. It shows a period where the Bitcoin price is rising and altcoins have remained flat. However, this has usually turned out to be the calm before the storm, and altcoin season tends to follow. If the analyst is right, then the altcoin season never started, and is still in the future.
Market Deviations Hold Back Altcoins
As Michaël van de Poppe mentioned, this cycle has been quite different from the previous one, and there have been a few reasons for this. The first is the advent of large buys from institutions such as Michael Saylor’s Strategy and heavy hitters like BlackRock buying up Bitcoin through exchange-traded funds (ETFs). The natural consequence of this is that money is now only staying in Bitcoin rather than rotating out at the top into altcoins like last cycle.
Also, a big difference between the current cycle and the 2020-2021 cycle is the availability of free cash. Following the COVID-19 lockdown of 2020, governments around the world disbursed billions of dollars to citizens to help them weather the storm, and this ‘free cash’ had inadvertently found its way into the market, triggering a massive altcoin season.
Other factors that have been pointed out to have contributed to this are the extreme P2P that emerged with the advent of instant meme coin creations. Thousands of new coins flood the market daily, and this has left liquidity spread thin. Also, broader macroeconomic factors such as Donald Trump’s tariff wars have contributed greatly to keeping market performance muted, and the weaker altcoins have suffered more for it.
Featured image from Dall.E, chart from TradingView.com
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