What is the rotation order between Bitcoin and altcoins?
Bitcoin has the longest duration in its phase, with funds primarily flowing into Bitcoin, driving the continuous rise in its price. Since the beginning of 2023, the return rate of Bitcoin has consistently outperformed altcoins, which is referred to as Bitcoin season. Most of the four-year cycle belongs to Bitcoin season, and Bitcoin's market share continues to show a unilateral increase. Therefore, at the beginning of the cycle, one should mainly hold Bitcoin.
During this phase, Bitcoin will outperform 99% of altcoins, so holding Bitcoin during this period is the best choice.
Ethereum Phase
In this phase, Ethereum will replace Bitcoin as the market focus. Ethereum's performance, trading volume, and return rate will surpass that of Bitcoin, and the market will begin to show a reversal. Bitcoin's market share will noticeably start to decline. From the ETH/BTC trend, it has already ended a three-year unilateral decline and is beginning an upward trend.
At the same time, funds will also begin to flow into large altcoins, with a clear increase in market buying, particularly noticeable with XRP, which is ranked third by market capitalization and has even surpassed its previous high from 2024. As the leading altcoin, Ethereum's performance determines the trends of all altcoins, and its continuous rise indicates that other altcoins will also begin to catch up.
Mainstream Coin Phase
Mainstream coins generally refer to large altcoins with relatively high market capitalization, roughly the top ten. After Ethereum rises to a certain extent, funds will simultaneously overflow into mainstream coins, starting a large-scale catch-up. Any altcoin with fundamental value will begin to show an upward trend.
Altcoin Season Phase
After mainstream coins start to explode in growth, market sentiment will be fully ignited, and various small and medium-sized altcoins will begin to rise together, even seeing increases of 20% over several consecutive days. The rise at this time does not consider fundamentals and is entirely driven by funds and sentiment.
Generally, the duration of an altcoin season phase is very short, typically lasting between 1-2 months. The last cycle occurred during a period of quantitative easing, supported by macro policies, which was an important reason for triggering the altcoin season.
Currently, there is no macroeconomic support for this cycle, and whether an altcoin season will emerge remains uncertain. If an altcoin season does occur, it will indicate that this cycle is nearing its end, with funds quickly switching hands to escape, which is also the last opportunity for survival in this cycle.
