According to analysts, the cryptocurrency market may be on the verge of a new altcoin season. Over the last 24 hours, Bitcoin's dominance in the market has fallen by 2%, while the prices of many altcoins have gone up. Ethereum has started to rise in tandem with Bitcoin, which often signals that tokens are about to outperform it. If Bitcoin's dominance drops more than it did in 2021 to 40%, the market could show even greater growth of altcoins. The main factor for this growth is the global money supply M2, which tracks the total volume of money circulating in the economy. Historical patterns show a strong correlation between this indicator and movements in the cryptocurrency market. As more money flows into the system, especially from countries like China, the UK, and the EU, cryptocurrencies absorb part of these funds.
Meanwhile, the fear and greed index still reflects the caution of retail investors, who are not entirely confident in an altcoin rally. Cryptocurrency analyst Danny reminded that statistically, the second quarter was the strongest month for the cryptocurrency market, and May, as a rule, demonstrated the largest growth for altcoins. In his opinion, the altcoin season begins in a period when Bitcoin's dominance starts to decline, and altcoins repeatedly test their support levels, forming the so-called 'Triple Bottom'.
This graphic pattern is considered a bullish reversal, and according to Danny, this is exactly what is forming in the market right now. He does not rule out the possibility of a 100-fold increase.
