Originally published on: December 02, 2024
As the cryptocurrency market gears up for the highly anticipated altcoin season, traders and investors are in for a surprise. According to a leading market analyst, the dynamics of altseason have evolved, bringing about significant changes in the traditional indicators.
In a recent post, CryptoQuant CEO Ki Young Ju highlighted the shifting landscape of the crypto market. Contrary to what was previously believed, altseason is no longer solely driven by capital rotation from Bitcoin to altcoins. Instead, altcoin trading volume against stablecoin and fiat currency pairs has emerged as a primary driver of market movements.
The data shows that despite a rise in Ether’s price, altcoin trading volume for Bitcoin pairs has remained relatively low in recent weeks. This shift in trading behavior signifies a significant departure from the previous market cycles, where altseason was characterized by asset rotation.
Moreover, the surge in trading volume for altcoins against stablecoin pairs reveals a growing market maturity and stability. This trend is indicative of real market growth rather than just capital rotation, as explained by Ki.
The influx of institutional capital into spot Bitcoin exchange-traded funds (ETFs) has also transformed the nature of capital flows in the current bull market. Unlike past cycles driven by retail investors, the current market is witnessing a significant uptick in institutional investments.
The Altcoin Season Index developed by Blockchain Center further corroborates the imminent altseason. With 73% of the top 50 altcoins outperforming Bitcoin in the last 90 days, the index is inching closer to the threshold of 75%, signaling a potential altcoin rally on the horizon.
As the market continues to evolve, observers are advised to keep an eye on stablecoin liquidity and Bitcoin dominance index for potential signals of an impending altcoin season. This analysis serves as a reminder that investment decisions should be made after thorough research and due diligence.
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