When Altcoin Season? Understanding Bitcoin's Current State

Many in the crypto space are claiming the market is exhausted simply because the long-awaited altcoin season is delayed or seemingly absent. Even Google Trends data shows a decline in searches for "Bitcoin" (the dominant crypto asset) reinforcing this sentiment.

But what if I told you that the market is moving like clockwork? In the last cycle, altcoin season did not arrive until the Federal Reserve ended Quantitative Tightening (QT) and global liquidity started increasing. This time is no different.

In this article, I will break down the key factors that need to align for an altcoin season to emerge and assess Bitcoin’s current state as the primary driver of the market.

What Triggers Altcoin Season?

For a sustained altcoin season to begin, at least one of the following catalysts must occur:

1. The End of Quantitative Tightening (QT) & Lower Interest Rates

   Liquidity is king. A shift in Fed policy would inject liquidity into markets, making risk assets like altcoins more attractive. I expect that this will occur in March.

2. Approval of a Bitcoin Strategic Reserve

   If institutions and governments formally recognize Bitcoin as a strategic reserve asset, confidence in the broader crypto market would soar, spilling over into altcoins.

3. Bitcoin Sustaining Prices Above $110K–$115K

   Historically, Bitcoin dominance remains high until it stabilizes at a new range, after which liquidity flows into altcoins. A strong, sustained Bitcoin price is crucial for a true altcoin rally.

It’s also important to note that markets tend to front-run news. Even hints of a policy shift from the Fed (end of February) could spark a significant movement.

Bitcoin’s Current State: Are We Near a Cycle Top?

Understanding Bitcoin’s position in the cycle is critical—even if your portfolio is mostly altcoins. Bitcoin’s performance dictates the broader market’s fate. Let’s examine key indicators to assess its health:

🌟 To access the interactive plots of these metrics and detailed explanations (including video breakdowns), just click on the charts.

1. Bitcoin Risk Below 50%

This suggests a medium-risk environment. Despite the largest single-day crash in crypto history (in dollar terms), Bitcoin barely flinched and recovered almost immediately. Price remains stable between $95K–$100K.

2. Short-Term Bubble Risk (STBR) at 1.14

The STBR metric is trending downward toward neutrality (<1), indicating the market is stabilizing. Values above 1.5–2 signal overbought conditions, but we are approaching the green zone—a historically bullish sign, especially with potential QE (Quantitative Easing) on the horizon.

3. Price Action Within Bollinger Bands

Bitcoin remains within a normal volatility range. Even during the recent crash, Bitcoin’s daily close price stayed above the lower Bollinger Band—a sign of strength.

4. Deviation from Power Law at 10.39%

A deviation greater than 70% often signals an overheated market and the need for exit planning. However, we are still at a healthy level, far from warning territory (values greater than 60%).

5. Free Float Market Value to Realized Value (FFMVRV) at 1.58

Historically, we only start discussing cycle tops when this metric exceeds 2. We are well within a favourable range. The FFMVRV is a cryptocurrency metric that assesses a digital asset's relative valuation by comparing its Free Float Market Cap (FFMcap) (calculated from the current price and readily available supply) to its realized cap (determined by multiplying the cost basis with the total supply).

6. Whales Accumulating Since September 2024

Large holders (wallets with more than 100 Bitcoin) continue to accumulate Bitcoin, reinforcing institutional confidence. With discussions about Bitcoin becoming a strategic reserve in countries like the U.S., this is a trend worth watching.

The Road to $180K+ Before November 2025

Unless a major negative macroeconomic event occurs—such as widespread tariffs across Europe and the UK—the overall trajectory remains intact. Bitcoin remains on track for a target above $180K before November 2025.

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