The Altcoin Season Index has reached 83, signaling that we may be entering an altcoin season. For context, the index measures whether 75% of the top 100 coins outperform Bitcoin over the last 90 days. A month ago, the index stood at 28, firmly indicating Bitcoin season. The shift in market dynamics is significant, with Bitcoin dominance falling by nearly 9% since November 21, and the altcoin market seeing increasing inflows.
This transition isn’t surprising. Over the past few months, Bitcoin has experienced a strong rally, largely driven by institutional demand and the anticipation of spot ETFs. However, the recent moves in the altcoin market suggest a redistribution of capital. XRP, for instance, added an astonishing $80 billion to its market cap in just a week, while other "dino" coins such as ADA, HBAR, IOTA, and LINK have also shown strong momentum.
Interestingly, it looks like the recent meme coin mania is cooling off as buyers shift toward other categories of altcoins. This could mark a more diversified focus among retail and institutional investors, with increasing interest in projects with more established use cases or potential for long-term growth.
The rise of altcoins often coincides with shifts in market sentiment. While Bitcoin remains the go-to for institutional investors, altcoins typically attract capital from retail investors seeking higher returns or those diversifying their portfolios.
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