Unlocking the Gold Mine in Cryptocurrency: An In-Depth Understanding of Altseason and Trading Strategies

What is Altseason (альтсезон)?

Altseason (Altseason) is a unique phenomenon in the crypto market—during this period, the total market capitalization of cryptocurrencies other than Bitcoin (called altcoins or альткоины) begins to surpass Bitcoin, usually accompanied by a strong upward market cycle.

Unlike early market patterns where funds rotated directly from Bitcoin into альткоины, the driving forces behind modern Altseason have undergone a fundamental shift. The surge in liquidity of stablecoins (especially USDT and USDC), influx of institutional investors, and diversification of market participants have become the main engines propelling this cycle.

According to the Blockchain Center’s Altseason Index, when the index exceeds 75, it indicates that the market has entered Altseason. As of December 2024, the index has risen to 78, meaning the market is clearly in Altseason territory, with the top 50 альткоины performing overall better than Bitcoin.

The fundamental difference between Altseason and Bitcoin season

Features of the Altseason stage:

When the market enters Altseason, investors’ focus shifts from Bitcoin to various альткоины. This period is characterized by:

• Significant simultaneous rise in альткоины trading volume and prices
• Notable increase in speculative trading activities
• Frequent launches of new projects and technological innovations
• Marked increase in retail investor participation

In this process, many альткоины often outperform Bitcoin, sometimes yielding several times the returns. Funds begin to seek higher yields after Bitcoin’s long-term rise, flowing into the альткоины market.

Features of Bitcoin season:

In contrast, Bitcoin season presents a very different picture:

• Bitcoin dominance index (Bitcoin’s market cap share of the entire crypto market) rises
• Market risk appetite declines, investors shift to more “safe” assets
• альткоины stagnate or decline
• Especially evident in bear markets, investors tend to hoard Bitcoin or stablecoins

Evolution of Altseason: from fund rotation to liquidity-driven

Past pattern: simple fund rotation

In early crypto market cycles, the start of Altseason was quite straightforward—after Bitcoin entered sideways consolidation, traders would shift funds into альткоины seeking high returns. This pattern fueled the ICO boom in 2017 and the DeFi summer in 2020.

Current shift: role of stablecoins and institutional capital

According to CryptoQuant CEO Ki Young Ju, the logic behind modern Altseason has undergone significant change. The previous simple “Bitcoin → альткоины” fund flow has evolved into a more complex mechanism based on stablecoin liquidity and trading volume growth.

Ample liquidity of stablecoins like USDT and USDC has led to a substantial increase in trading volume of альткоины trading pairs (e.g., ALT/USDT). This not only reflects market speculation but more importantly indicates genuine market growth and the entry of institutional capital.

Ethereum’s leading role and institutional deployment

Ethereum often acts as the “icebreaker” in Altseason. Its continuously developing DeFi ecosystem, NFT market, and mature Layer-2 solutions have gradually attracted institutional investors’ attention away from Bitcoin.

Analysts expect that as Ethereum’s ecosystem continues to improve and institutional capital diversifies further, Ethereum’s strong performance will further drive the rotation and upward movement of the entire альткоины market.

Key indicators for interpreting Altseason

Bitcoin dominance index

A decline in Bitcoin dominance is the most direct signal of Altseason. Historical data shows that when this index falls below 50%, it usually marks the official start of Altseason. Currently, many analysts believe that Bitcoin’s consolidation range between $91,000 and $100,000 may provide sufficient liquidity absorption space for Ethereum and other альткоины.

Ethereum relative performance (ETH/BTC ratio)

When the ETH/BTC ratio rises, it indicates Ethereum is gaining excess returns relative to Bitcoin, often signaling a broad upward trend in альткоины. Conversely, a decline may suggest Bitcoin’s market strength.

Altseason index

This indicator measures the combined performance of the top 50 альткоины relative to Bitcoin. An index above 75 indicates the market has entered a clear Altseason phase.

альткоины trading volume and liquidity

A surge in trading volume of stablecoin pairs (e.g., USDT/USDC pairs involving альткоины) often signals a shift in market sentiment and increased institutional participation.

New features of Altseason in 2024

Unlike previous Altseasons, 2024’s альтсезон exhibits unique scalability:

Rise of AI-related tokens

Projects integrating blockchain and artificial intelligence have attracted massive attention. AI concept coins like Render (RNDR) and Akash Network (AKT) have surged over 1000%, reflecting strong market optimism for AI + crypto fusion.

Revival of GameFi

Game blockchain platforms such as ImmutableX (IMX) and Ronin (RON) have regained attention, attracting not only gamers but also new investors into the crypto ecosystem.

Expansion of memecoins

Once considered “toys,” memecoins have evolved to incorporate AI and real-world applications. Meanwhile, the memecoin boom in the Solana ecosystem has driven token ecosystem value up by 945%.

Decentralization across multiple chains

Contrasting with the trend of concentration on Ethereum, current Altseason features distribution across multiple blockchains, with альткоины on Solana, Polygon, Cardano, and others experiencing independent upward movements.

Historical Altseason review and insights

End of 2017 – early 2018: ICO bubble era

During this period, Bitcoin’s dominance dropped from 87% to 32%, and the total value of альткоины surged from $3 billion to over $60 billion. Projects like Ethereum, Ripple, Litecoin became market favorites but eventually ended due to regulatory crackdowns and project failures.

Early 2021: DeFi and NFT frenzy

Bitcoin dominance fell from 70% to 38%, while альткоины’ market share surged from 30% to 62%. The three waves of DeFi, NFT, and memecoin explosions pushed the entire market cap beyond $3 trillion.

Q4 2023 to mid-2024: transition period with institutional entry

This Altseason was driven by different logic—not solely by ICOs or new tech hype, but by expectations of Bitcoin halving, ETF approvals, and improved policy environment.

Four stages of liquidity trajectory in Altseason

Stage 1: Bitcoin dominance phase

Capital flows mainly into Bitcoin, regarded as the most stable crypto asset. альткоины are mostly stagnant or declining.

Signal to identify: Rising Bitcoin dominance index, concentrated BTC trading volume

Stage 2: Ethereum takes off

Liquidity begins shifting toward Ethereum, with DeFi and Layer-2 projects becoming focal points.

Signal to identify: Rising ETH/BTC ratio, increased activity in DeFi protocols

Stage 3: Main альткоины rally

Large альткоины with established ecosystems like Solana, Cardano, Polygon experience rotation and upward movement.

Signal to identify: These projects achieve double-digit percentage gains

Stage 4: Participation of small-cap альткоины

Small market cap and speculative tokens start to surge parabolically, with Bitcoin dominance falling below 40%.

Signal to identify: Extreme gains in small-cap coins, market sentiment reaching a climax

How to identify the signals of Altseason start

Decline in Bitcoin dominance

When this index drops significantly below 50%, it usually marks the official beginning of Altseason.

Rise of ETH/BTC ratio

This indicator directly reflects Ethereum’s relative performance; an upward trend often signals a broad strength in альткоины.

Surge in stablecoin trading volume

A sharp increase in trading volume of pairs like USDT and USDC with альткоины indicates strong investor interest.

Concentrated gains in specific sectors

When sectors like AI tokens, GameFi tokens, or memecoins see collective gains over 40%, it often signals the broad launch of Altseason. Data from K33 Research shows that memecoins like DOGE, SHIB, BONK, PEPE surging over 40%, and stable growth of AI tokens like Render and NEAR Protocol, are strong market signals.

Market sentiment shift

A transition from fear to greed index, combined with rising social media buzz, often signals the onset of Altseason.

Trading principles and risk management during Altseason

Deep research is essential

Before investing in any альткоины, thoroughly research the project’s fundamentals, team background, technological innovation, and market prospects. Don’t be blinded by market hype.

Diversify your portfolio

Spread investments across multiple sectors and projects rather than all-in on a single coin, significantly reducing risk exposure.

Reasonable return expectations

While Altseason can yield substantial returns, don’t expect to get rich quick. Remember that market volatility can lead to rapid losses.

Strict risk control

Set stop-loss levels, control position sizes, and maintain a reasonable balance between risk and reward—these are essential for survival in highly volatile markets.

Unavoidable risk factors

Extreme volatility

альткоины prices are usually more unstable than Bitcoin, potentially causing huge losses in a short period. Low liquidity can also lead to larger spread costs.

Market overheating and bubbles

Excessive market enthusiasm and speculation can push prices to unsustainable levels, ultimately leading to “bubble bursts.”

Fraud and “Rug Pull” risks

Beware of malicious projects and rug pulls—developers attract funds and then run away with the money. Also avoid market manipulation like pump-and-dump schemes.

Regulatory risks

Closely monitor global regulatory developments. Adverse regulatory announcements can instantly destroy market sentiment, while favorable policies may catalyze a new upward cycle.

The profound impact of regulatory environment on Altseason

Historically, regulatory changes often mark turning points for Altseason.

Negative example: The crackdown on ICOs at the end of 2018 directly ended that Altseason; strict regulations on exchanges have also caused market shocks multiple times.

Positive example: In January 2024, the US SEC approved spot Bitcoin ETFs; expectations for Ethereum spot ETF approval this year, and political support for crypto-friendly regulators (such as the Trump administration’s pro-crypto stance), have all become key catalysts for the current Altseason.

These signals indicate that when regulatory frameworks shift from opposition to acceptance, markets often usher in long-term growth opportunities.

Market background and outlook at the end of 2024

As of December 2024, multiple factors have laid the foundation for Altseason:

Regulatory breakthroughs

Over 70 spot Bitcoin ETFs have been approved, fully opening the gates for institutional entry.

Political and policy expectations

The new US administration’s pro-crypto stance is highly anticipated, setting a positive tone for long-term growth.

Market size reaching new highs

The global crypto market cap has reached $3.2 trillion, surpassing the 2021 peak, reflecting genuine growth rather than mere hype.

Bitcoin’s psychological milestone

After breaking its all-time high in November, BTC approaches $100,000. Most analysts expect this psychological level to be surpassed by late 2024 or early 2025, often creating conditions for альткоины rotation and upward movement.

Building profit strategies during Altseason

Systematic research framework

Focus not only on price gains but also on understanding the project’s economic model, innovation significance, and market potential.

Phased position building and profit-taking

Avoid all-in strategies; instead, enter gradually and take profits in stages to lock in gains and reduce exposure to extreme volatility.

Monitor micro-market indicators

Regularly track key indicators such as Bitcoin dominance, ETH/BTC, and the Altseason index to adjust positions timely.

Psychological resilience

The biggest enemy in Altseason is often human nature—greed and fear distort decision-making. Staying calm and disciplined is the most valuable asset.

Conclusion

Altseason offers crypto investors a unique opportunity window, but this window is fraught with traps. By deeply understanding market indicators, adhering to risk management principles, and keeping abreast of regulatory and technological developments, traders can significantly improve their chances of profiting during this cycle.

Currently, at the critical end of 2024, multiple positive factors are converging, and the next Altseason may be on the horizon. But remember—knowledge, discipline, and patience are the true keys to winning in this emotion- and capital-driven game.