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The recent weeks have been brutal for altcoins, with many dropping between 50-80%, while Bitcoin remains steady around $96K. This has created a divide in the crypto industry—those holding primarily Bitcoin are largely unaffected, whereas altcoin-heavy investors are questioning if this cycle is different and whether there will be no altcoin season.
However, let’s set the record straight on what altcoin season is, why people misunderstand it, and why the reality is actually simple:
Definition: Altcoin season occurs when altcoins outperform Bitcoin (red line above purple line).
History: It typically lasts 3-5 months within a 4-year cycle.
Strategy: The best approach is to dynamically accumulate Bitcoin for 3.5 years and then rotate a portion into altcoins during the 5-month window.
Many investors expect an early altcoin season, leading them to continuously allocate funds into altcoins, only to watch their portfolio bleed. My last article, published before the crash, outlined when to expect altcoin season. To summarize, it typically begins when one of these three conditions is met:
The end of Quantitative Tightening (QT) and lower interest rates
Approval of a Bitcoin Strategic Reserve
Bitcoin sustaining prices above $110K–$115K
🌟 To access the interactive plots of these metrics and detailed explanations (including video breakdowns), just click on the charts.
Bitcoin Dominance and Why It Matters
Bitcoin dominance has recently hovered between 57%-61%, which is actually a positive sign. Historically, all altcoin seasons have started with Bitcoin dominance above 60%, followed by capital rotation into altcoins over a 3-5 month window. This shift sparks FOMO, leading retail investors to pile in and sustain the altcoin rally.
For altcoin season to happen, the risk appetite of investors must be at its peak. This usually coincides with monetary policies that provide ample liquidity. Therefore, monitoring global central banks for signs of easing, such as lower interest rates and an end to QT, is crucial.
The Smart Approach to Altcoins
As I’ve emphasized to premium users on our platform, there’s no need to take excessive risks by prematurely betting on an altcoin season. A smarter strategy is to allocate capital to Bitcoin, allowing it to reach higher prices first. Once we have confirmation that altcoin season has begun, then rotating capital into altcoins makes sense. Yet, many investors try to front-run the market, leading to an average of 60% losses on altcoins recently.
Be patient—altcoin season will come when global liquidity conditions improve, making it safer to increase risk exposure.
Bitcoin Risk & Market Conditions
Our Bitcoin risk model, which tracks on-chain and off-chain data daily, currently shows Bitcoin risk at just 41% and declining. This is an excellent window in a bull market through which one can accumulate dynamically as risk drops to lower risk bands.
Another key metric to watch is the Bull Market Support Band (20-week SMA and 21-week EMA). This level, now around $90K, is critical for Bitcoin to maintain its bull run. Personally, if Bitcoin reaches this level, I will increase my accumulation, assuming supporting data continues to favour Bitcoin.
Conclusion
I still believe Bitcoin will surpass $180K by the end of 2025 and that altcoin season will occur, as it always has. The problem is that many investors try to force it to happen prematurely. Unfortunately, the ongoing meme coin fiascos are damaging the industry and delaying broader investor confidence.
Now is the time for crypto retail investors to adopt a more disciplined approach to capital allocation. Avoid falling for misleading narratives designed to use you as exit liquidity. Stay patient, follow the data, and altcoin season will come when the conditions are right.
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