On August 12, Ethereum broke through $4700, setting a new four-year high. @CryptoHayes, who took profits early last week, also bought back Ethereum on August 9; Bitcoin also set a new high, and the total market capitalization of cryptocurrencies surged to $4.2 trillion, completely igniting market sentiment.
The traditional market is also booming. The S&P 500 and Nasdaq 100 have both refreshed historical records, and global liquidity is accelerating into risk assets; the dollar index (DXY) has fallen below 98, further opening the floodgates for capital to flow into the stock and cryptocurrency markets. Such a macro environment not only solidifies the upward trend but also boosts investors' confidence in high-risk assets.
At the same time, the market is almost certain that the Federal Reserve will cut interest rates at the meeting on September 17, with a probability close to 100%, and will lower the benchmark interest rate to the range of 4.00%-4.25%. This expectation provides additional fuel for markets that rely on high liquidity—especially cryptocurrency. Now, the wealth effect of the altcoin season has become a hot topic in the market, and the key is when it will fully start.
Next, Rhythm BlockBeats organized traders' views on the upcoming market situation to provide some directional references for this week's trading.
@b66ny
BTC.D has recently shown a clear downward trend, having fallen from a previous high to about 57.7%. Combined with the trend of ETH.D, I believe this is a typical signal of capital rotation: market funds are starting to withdraw from relatively stable assets and are instead pursuing higher risk and higher potential returns. Historically, the continuous decline of BTC.D is often one of the necessary conditions for the initiation of the altcoin season.
ETH.D not only represents the strength of Ethereum itself but is also often seen as the leader of the entire altcoin market. Currently, ETH.D is performing strongly, with its dominance recovering to 14.0%, and accompanied by a rapid rise in ETH price, ETH/BTC has increased by over 4% within 24 hours, indicating a clear trend of capital flowing from Bitcoin to Ethereum.
This trend is a classic script of capital rotation: in the first phase, BTC stagnates or even retreats, and capital begins to flow into ETH; the rise of ETH not only boosts market confidence but also creates conditions for injecting more liquidity into the altcoin market.
What deserves attention next is OTHERS.D (the market capitalization ratio of mid-cap altcoins excluding leading coins like BTC and ETH). Currently, OTHERS.D is still in a long-term bottoming phase and has not shown explosive growth similar to ETH.D, which means capital heat remains concentrated in a few leading assets like ETH. Although SOL has also seen a noticeable rise today, with clearer signs of capital rotation, it has not yet fully spread to high-risk, small-cap speculative sectors.
Considering three major indicators, the market is likely in the early stage of rotation:
Occurred: BTC.D declining, capital overflowing.
Happening: ETH.D rising, capital concentrating into ETH.
Not yet occurred: OTHERS.D rising, capital spreading to small-cap altcoins.
@im_BrokeDoomer
Based on the comparison of the market capitalization of altcoins and Bitcoin from 2017 to the present, we are currently at a critical support position at the lower edge of a channel. This position has historically been a sensitive area for capital injection, often accompanied by a warming of market sentiment and accelerated rotation. If this support is confirmed, the altcoin sector is expected to experience a collective explosion, marking the official start of a new altcoin season.
The initiation process of the altcoin season generally follows the pattern below: Bitcoin (BTC) starts the market → Ethereum (ETH) follows with an upward trend → BTC gains strength again → ETH breaks its all-time high (ATH) → Large-cap altcoins rise → BTC sets a new high → ETH and large-cap altcoins reach new highs together → Mid-cap altcoins take off → Small-cap altcoins experience a full explosion.
We are currently in the third stage, where ETH and large-cap altcoins have set new highs, and subsequent explosions from other altcoins can be anticipated.
@ZssBecker
In the previous bull market of 2020, most altcoin narratives did not explode at the beginning but waited until the ETH price broke its historical high and rose threefold before fully initiating. At that time, capital surged into new narratives—such as the gaming sector—driving related tokens to soar by 10, 20, or even 50 times, with Sandbox even soaring 80 times. Even the most hollow and marginal gaming projects achieved several times increases. This phenomenon did not truly occur until later in the bull market, but once initiated, it became a concentrated explosion period of wealth effect.
I believe this scene will repeat in this round of the market. We are still in the first phase of the altcoin season—where BTC and ETH dominate. We need to wait for ETH to break above $5000 and for mainstream altcoins to achieve 2-3 times increases before market capital will frantically search for the next narrative. The most likely candidates to take over will be AI, RWA, and gaming, as these three areas have been efficiently penetrated and profited from by the cryptocurrency industry in reality, possessing strong narratives and high potential returns.
The previous round of game narrative initiation allowed countless people to turn a few thousand dollars of capital into millions; this time, the market capital scale is larger and the risk appetite is higher. Once initiated, the driving force of capital will only be more intense. For investors, the key is not to chase anxiously now, but to wait patiently and lay out positions in advance. When the signal for narrative switching appears, the climax of the altcoin season will truly arrive.
@lanhubiji
Understanding market structure will reveal that the altcoin season will definitely come, but the form may be completely different from the past two rounds. Previously, the number of altcoins was limited, and capital was relatively concentrated, with almost all leading sectors experiencing a rise; however, there are now over a million coins on the market, making competition extremely dispersed, and capital cannot cover all targets.
This means that what is more likely to occur in this round of market is a 'localized altcoin season'—capital will concentrate on a few sectors or individual tokens with strong narratives, strong communities, and strong liquidity, creating localized euphoria, while most coins will still be overlooked by the market. For investors, opportunities still exist, but the probability of selecting the right targets is much lower than in the past, and there is currently more optimism about the AI sector.
@joao_wedson
The true altcoin season is still far from starting. The flow path of smart capital usually is: first flowing from BTC to ETH, then entering leading large-cap coins, and finally spreading to mid and small-cap tokens. The current market is only just entering the first half, and the real 'altcoin frenzy' is still on its way, possibly continuing until November. In other words, the rise seen now is merely the 'appetizer,' while the real 'main course' has yet to be served.
