As the market cycle progresses, many investors are eagerly waiting to see whether the long-awaited "altcoin season" will really arrive as scheduled? Market sentiment is growing, but this time the altcoin season will be very different from previous years!
Altcoin Season: Extraordinary Challenges
On Friday, analysts finally confirmed: the altcoin season has begun! However, unlike in the past, this cycle will no longer see the traditional rotation of Bitcoin and altcoins. Analysts pointed out that Bitcoin's dominance no longer determines the trend of altcoins. In the past, altcoins were always highly correlated with Bitcoin, but this "relationship" has now broken down.
Today, trading volume has become the key indicator determining the fate of altcoins. Currently, the trading volume of altcoins is 2.7 times that of Bitcoin! This also means that competition in the altcoin market will become even more intense. Only a few altcoins with a strong user base and clear narratives will survive this storm.
The market has entered the 'zero-sum PvP' phase: new liquidity has yet to arrive.
Analysts remind us that the current market presents a 'zero-sum PvP' (player versus player) pattern, with no new capital inflow, and competition is becoming increasingly fierce. Although Bitcoin's market cap has doubled, the market cap of altcoins has yet to recover to its historical high. This also means that, unless there is new liquidity injected, most altcoins will continue to struggle in volatility.
Only those altcoins with strong use cases, real application scenarios, and compelling narratives have the potential to stand out in this 'altcoin battle'.
Second round of significant increases for altcoins: Is the market ready for a new cycle?
From the recent market performance, it seems that altcoins are ready to welcome the 'second round of significant increases'! Traders indicate that altcoins are recharging according to the classic strategy of 2020-2021.
Looking back at the previous cycle, altcoins experienced two rounds of significant increases, ultimately breaking through a market cap of $1.13 trillion, setting a new historical high. In the first round of the increase, altcoins broke through the accumulation period and quickly entered a brief re-accumulation phase. Following that, they welcomed a second round of gains, setting new highs and driving market enthusiasm to soar.
The breakthrough in the altcoin market: will it reach new highs at this critical moment?
Analysts point out that the altcoin market is currently at the tail end of the first round of increases, and the market has begun testing the top of the previous cycle. The current market cap is between $250 billion and $280 billion; if altcoins can break through and stabilize above $280 billion, it will pave the way for further challenges towards the $300 billion mark.
In addition, after breaking through the two-month downtrend channel, the altcoin market has shown a strong parabolic trend, with an increase of over 120%. Analysts believe that altcoins need to reclaim the resistance level of $300 billion to further break the current consolidation pattern and initiate a new upward trend.
The altcoin season faces many challenges, but opportunities still exist!
Although the current altcoin season is full of challenges, it also hides enormous opportunities. The market is not static; those altcoins with strong application value and solid backing will stand out in this fiercely competitive cycle. If you are cautious about investing in altcoins, now is a crucial moment for analysis and planning.
