How Long Will Altcoin Season Last? Bitcoin Dominance And Other Factors Explored

Altcoin season. It is a time when altcoins like Ethereum, Litecoin, Dogecoin, and others vastly outperform the first ever cryptocurrency, Bitcoin. Moments like these are few and far between, but can bring crypto investors and traders more money than they ever imagined or dreamed of.

Eventually, Bitcoin dominance will recover and a new wave of BTC maximalists will appear. The cycle happens again and again, yet investors always fall victim to greed and get stuck holding heavy bags for years of a bear market until these assets explode again.

Altcoins tend to boom in such short pulses, that if you blink, you can miss them. Here is how to spot an altcoin season forming, along with intel on how long the current altcoin season might last, and when Bitcoin might regain the upper hand.

What Are Altcoins And What Is Altcoin Season?

By definition, an altcoin is any cryptocurrency that isn’t Bitcoin, a stablecoin, or an NFT token. There are more than 10,000 such altcoins in existence and more are being minted each day. Most of these coins live on Ethereum as an ERC-20 token, while others are their own projects and on a unique mainnet.

With so many other coins created through Ethereum, Ethereum itself is the top altcoin by market cap and second in the market only to Bitcoin. Because it is so powerful, and has so much built on its back, there is potential to rival Bitcoin’s market cap and cause what the cryptocurrency community refers to as a “flippening.”

Ethereum passing Bitcoin’s market cap could be a game changer for the face of crypto, as Bitcoin would no longer be ranked number one in the market it created. What this might mean for Bitcoin is that altcoin season never ends as the top altcoin will have taken over.

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Since its inception, Ethereum has vastly outperformed Bitcoin, and has done so since the onset of the pandemic. As well as Ethereum has done, other altcoins have done significantly better.

Top Performing Altcoins And How They Compare

Take Solana as a recent example. The Ethereum competitor where users can mint NFTs and other tokens is growing out of control as ETH gas fees soar. It has risen 15,000% year to date, making any investors rich who got in early, just as Ethereum and Bitcoin did. At one point, Ethereum was tiny compared to Bitcoin, and today there’s talk about it taking over. Could Solana also do the same?

That’s how the altcoin market and altcoin season works. Once investors get the bug in their ear that they can make more profits than with Bitcoin or Ethereum by finding the next big thing, that is when the market tends to spin out of control.

Just like years ago, most cryptocurrencies are relatively worthless and have nothing to show for the billions of capital behind them. Investors hope that someday these coins become something, but many don’t ever come to fruition. Ethereum is again a great example, having fallen drastically after the ICO boom fizzled out.

Sentiment turned and Ethereum fell by more than 90% to the bear market bottom. Bitcoin’s fall was nowhere near as hard, as real value had developed. Ethereum’s next fall might not be as severe, but dozens of speculative altcoins out there are doomed to similar fate.

When Does Altcoin Season End? What Bitcoin Dominance Says

When the current altcoin season ends, many of these investors will eventually be stuck with losses as much as 99% in assets that have very little substance. So while those in crypto now are loading up on meme coins and other nonsense, they’ll eventually realize how little they’re worth in the long run.

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And that’s how Bitcoin dominance resets, and the cycle starts all over. At the end of the last altcoin season, BTC dominance fell as low as 35%, meaning that Bitcoin only commanded a little more than a third of the total crypto market cap. When altcoin season ended, however, dominance skyrocketed to as high as 73% or more than two thirds of the total market value.

At that point, Ethereum was called by top crypto execs a “double digit shitcoin” and altcoin sentiment in general was at its lowest. Per usual, this is actually when investors should have been buying these coins, as this was the absolute bottom and the trend reversed from there.

With so many more coins in the crypto market compared to 2017, and with many of them commanding real value and capital like Ethereum, dominance will not ever return to such high levels, and could very well make new lows before the current market cycle is over.

During the last cycle, BTC dominance made a double top with a bullish divergence before reversing. The current technical structure suggests that altcoins could outperform Bitcoin another two to three months.

How To Profit From Altcoin Season With PrimeXBT

The market is expecting altcoin season to end roughly a month or so following the top in Bitcoin. However, the market cycle in altcoins clearly doesn’t match up perfectly with Bitcoin one to one, so anything is possible. A scenario where altcoins top out first could shake things up, and the capital flowing out of altcoins and into Bitcoin could be what helps to propel the coin to prices of more than $100,000 each BTC.

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Until altcoin season is showing more signs of ending, stay active on an Ethereum trading exchange such as the award-winning PrimeXBT. Not only does the platform offer CFDs on Bitcoin and top altcoins like Ethereum and Litecoin, altcoins trade against both USD and BTC, so traders can take advantage of altcoin season while it is still going strong, but also profit from shorting altcoins on the BTC trading pair when the altcoin season ends.

This ebb and flow of capital in and out of Bitcoin to altcoins and back, is yet another way traders can make money from crypto markets using PrimeXBT.

Misty Tate

"Freelance twitter advocate. Hardcore food nerd. Avid writer. Infuriatingly humble problem solver."

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