Author: Biraajmaan Tamuly, CoinTelegraph; Translated by: Tao Zhu, Jinse Finance
Summary
The total market cap of altcoins (excluding ETH) increased by $126 billion in the second quarter, sparking speculation about the altcoin peak season.
The market cap of altcoins excluding Ethereum increased by $126 billion in the second quarter, igniting enthusiasm among analysts who have been eagerly awaiting the altcoin peak season. Cryptocurrency analyst Javon Marks points out that this breakout could be comparable to the explosive bull market of 2017.
Marks highlights in a recent article on X a chart that compares the TOTAL3 index (the total market cap of altcoins excluding Bitcoin and Ethereum) with the U.S. money supply, suggesting that altcoins may be on the verge of a significant increase.
The rise of the TOTAL3 index relative to the U.S. money supply indicates that altcoins are appreciating relative to the total liquidity of the U.S. economy, reflecting increased investor interest and capital inflow into altcoins.
Marks emphasizes that altcoins have rebounded from a key retest level following the breakout and states: 'Altcoins have rebounded from a breakthrough retest of the U.S. money supply and may be poised for one of the strongest rallies since 2017!'
Similarly, anonymous cryptocurrency trader Moustache shared an analysis on X highlighting the head-and-shoulders pattern appearing weekly in the TOTAL3 chart. This chart compares 2021 and 2025, reflecting the trends of altcoins in 2021 when top altcoins surged by 174% during the final phase while Bitcoin only increased by 20%. This pattern is a bullish reversal indicator, suggesting that the market is set for a rebound, with analysts predicting that altcoins will 'rise significantly.'
The 'Altcoin Season' Triggers Analyst Sentiment Fluctuations
While some analysts are optimistic about altcoin increases, others are taking a cautious stance. Technical analyst Crypto Scient explains that the recent rise in altcoin market cap has not yet reflected a bullish trend shift in higher time frames (HTF). The analyst points out that TOTAL2 remains bearish after hitting the $1.25 trillion resistance level and states:
Due to BTC and TOTAL being close to resistance levels, and TOTAL2 still having some room, I tend to think we are in a distribution phase.
Similarly, cryptocurrency commentator DonaXBT believes that a substantial breakout of Bitcoin's dominance trend line is crucial for significant volatility in altcoins. The attached chart shows Bitcoin's dominance has exceeded 60%, and the weekly uptrend remains intact.
Bitcoin's dominance. Source: Cointelegraph/TradingView
According to analysts, dropping below 60% and subsequently retesting the support area between 56% and 58% could be the initial catalyst for a full-blown altcoin season.
Altcoin spot trading volume is still below $10 billion.
CryptoQuant data shows that altcoin spot trading volume remains sluggish, averaging $3 billion to $5 billion daily, while the fourth quarter of 2024 is expected to be $8 billion to $12 billion, indicating that altcoins are in the early stages of a rebound. Despite the low trading volume, market observers believe this is a sign of significant growth for altcoins, suggesting that they have not yet reached peak momentum.
Bitcoin and altcoin spot trading volume. Source: CryptoQuant
As noted by Blockchaincenter.net, the altcoin season index is currently at 24, further confirming that the market is in a Bitcoin season, supporting this view. Historically, an index below 25 indicates Bitcoin dominance, but this could be a positive signal for altcoins. When the index rises above 30-40, altcoins usually experience significant increases, primarily due to capital rotation from Bitcoin.
As trading volume shows early signs of recovery and the altcoin season index indicates a market shift, investor optimism around the altcoin rebound is growing.
