The year 2025 began with some notable action in the cryptocurrency space as prices for both Bitcoin and altcoins made meaningful moves. Some began the year on a tear, but a recent slump, due to growing global economic questions and looming potential regulations, has dampened enthusiasm among investors.

So, in this article, we consider what altcoin season is, what are its features and signals when it may come (in 2025?), as well as how to prepare to take advantage of it.

Key Takeaways

1. Altcoin season typically begins with increasing investor activity, high trading volumes, and positive sentiment around altcoins. However, altcoin season isn’t a fixed period, it can vary in length and intensity.
2. While alt seasons provide attractive opportunities for investors, they also bring higher risks and stronger market volatility. To identify the best altcoins to invest in, it’s essential to understand the underlying factors that trigger altcoin season and the key indicators that signal its presence.
3. Historically, altcoin rallies start around 180 days following a Bitcoin halving, meaning it could be more than 180 days or sometime around May 13, 2025.

Why Altcoin Season Happens

Now, let’s take a look at what is altseason and why it matters. Altcoin season is a period in the cryptocurrency market when altcoins (all the cryptocurrencies except Bitcoin) show more significant growth than Bitcoin. It is a result of a complicated mix of market psychology, liquidity flows, and speculative behavior in the market. Several reasons are causing the emergence of this phenomenon:

• BTC prices rising and falling.
• Increasing risk appetite.
• Media and social media hype on altcoins.
• Technical and market cycles.
• Innovations and technological trends.
• Speculative effect.

Whatever the reason for the growth of individual altcoins, or the market as a whole, it affects the behavior of both major market players and individual crypto enthusiasts.

Why Altseason Matters

Altseason indicates noticeable changes in the crypto market and provides specific opportunities and perspectives for investors, developers, and the wider blockchain community. Altcoin season means:

• Massive profit potential. During this time altcoins can experience parabolic gains even up to hundreds or thousands of percent. For traders and investors, it is the time to capitalize on top short-term ROI in crypto.
• Diversification and flow of capital. Altseason exemplifies how capital flows through the ecosystem: BTC – ETH – Large-cap alts – Mid/small-cap alts. Understanding the essence of this flow can help investors enter and exit more carefully.
• Higher risk appetite. Altseason is a leading indicator of increased speculation. It’s generally the time of peak optimism, telling us where we are in the macrocycle of crypto (e.g., mania phase vs. consolidation).
• New narratives and sectors. During altseason, new advents in blockchain appear (e.g., DeFi in summer 2020, NFT boom in 2021, and AI coins in 2023). It’s around the time that novel projects find their footing, users, and funding – ultimately shaping the direction of Web3.
• Retail participation surge. Retail investors are frequently the ones that are sucked in during altseason with a preference for lower entry prices. This increased participation will raise the total crypto user population, particularly for specific chains or applications.
• Decentralization of value. Bitcoin dominance generally decreases during altseasons, which means the ecosystem is organically growing.

Besides, altseason can be bubble territory, representing the high times and possibly reaching overbought and overinflated prices. Most altcoins fall 80–95% from their highs. It’s all about timing and risk management. Depending on how you play it, it is both a golden opportunity and a warning signal.

Market Cap Rotation & Investment Flows

If Bitcoin prices remain flat or go sideways, investors frequently move their capital to altcoins in the search for higher-reward opportunities. Any positive news such as regulator approval or adoption of a coin attracts investor attention and the capital. With more optimistic feelings toward the market, investors tend to search for more investment opportunities beyond Bitcoin including alternative cryptocurrencies.

FOMO & Speculative Behavior

The rapid and often staggering surge in altcoin prices during altseason creates a sense of urgency and fervor in the market. During this time investors see others getting rich, and FOMO (Fear of Missing Out) takes over, causing even more people to enter the market unprepared and without any strategy.

The social media buzz, viral stories of success, and some influencer's meme coins, also impact this. So prices are rising, speculative fever picks up in intensity – traders begin to chase short-term gains, buying based on momentum, and fashion. This cycle is self-reinforcing – as prices advance, they attract more attention, which in turn attracts more buyers, pushing prices still higher until the trend starts to reverse or stall, often with severe corrections.

Historical Altseasons

During the previous altcoin seasons, many coins have seen extreme gains such as those that increase by thousands of percent in a matter of days. There were two prominent periods of altcoin booms:

2017-18 ICO Boom

The first altcoin season started in 2017 when Bitcoin’s market dominance plunged from 86.3% by the end of the year to a mere 38.7% by early 2018: Bitcoin’s price plunged from its then-peak of over $20,000 to under $6,000 over several months.

This created a bubble in the altcoin market due to the crazy ICOs. Many new blockchain ventures raised money through selling tokens, leading to a boom in altcoin activity and investments.

2020-21 DeFi & Memecoin Pump

During COVID-19 retail investors and Bitcoin enthusiasts started to touch a new range of coins, marking the return of altcoin season again.

The period ushered in DeFi (Decentralized Finance) projects and meme coins like Dogecoin and Shiba Inu that captured the imagination of the market with market interest expanding like no other. Non-fungible tokens (NFTs) were also a significant factor, generating enthusiasm for decentralized applications.

Bitcoin’s dominance reduced from 70% to 38% and the altcoin market share increased from 30% to 62%. The Altcoin Season Index hit 98 on April 16, 2021.

Signals Altseason Has Started

To notice the signs of the altcoin season approaching, one must constantly monitor market cycles and keep an eye on the altseason patterns. There are some special tools that can be useful for that, but typically they are lagging indicators: once the index has confirmed an alt season, the entry points could have long gone. Here are some early warning signs that may help you stay ahead of the curve.

Altcoin Season Index Usage

The Altcoin Season Index of CoinMarketCap tracks the performance of altcoins against Bitcoin. It assists traders and investors in recognizing market trends and making necessary strategy adjustments.

The index follows the top 100 cryptocurrencies at CoinMarketCap (excluding stablecoins and wrapped tokens). The performance is measured over 90 days. It calculates only how many coins of the top 100 have beaten the value of Bitcoin during 1H, 4H, 12H, and 1W.

Bitcoin Dominance Decline

Bitcoin dominance decrease itself isn't an indicator of a new altcoin season starting, but it shows that the importance of Bitcoin as a part of the total cryptocurrency market cap is getting reduced, and the value of all other altcoins is increasing faster. Therefore, if Bitcoin dominance is going down, it often means that altcoins are eating some ground and that the speculation is rising, all according to a different market narrative.

Increase in Altcoin Dominance

The primary indicator of a new altcoin season approach is when altcoin dominance in the entire crypto market is getting stronger. Altcoin dominance is the total market capitalization of all cryptocurrencies other than Bitcoin, as a percentage of the total market capitalization. An extended increase in this number typically signals that investors are beginning to focus on digital assets other than Bitcoin.

Technical Breakouts (Golden Cross)

Another sign of a forming alt season is the appearance of major technical breakouts throughout the altcoin market. When these assets take off on the upside, and then go through some critical levels and new highs, new investors get interested in joining this high-growth bullish rise. Even though some altcoins show promising signs of strength, not all of them can sustain their breakout momentum.

Why 2025 Might See Altseason

So, when is the new altcoin season? 2025 seems like a prime candidate to be the next altcoin season for several reasons—market cycle timing, macro trends, and technology. Here are the possible signs of approaching altcoin season:

Post-halving 180-Day Pattern

The history repeats with a huge bull market within 12–18 months following a Bitcoin halving. We have already witnessed several such cycles:

• 2012 halving – 2013 altseason
• 2016 halving – 2017 altseason
• 2020 halving – 2021 altseason
• 2024 halving – 2025 altseason?

Institutional Inflows & ETF Impact

Historically regulatory ambiguity has posed a significant obstacle to altcoin adoption. But 2025 might be a turning point, according to several indications that could nudge the market in a positive direction.

• Spot ETF approval: New spot ETF approvals may legitimize altcoins such as Solana and XRP, opening the doors for more institutional money to flow into the market.
• Regulatory clarity: Providing clarity on DeFi tokens, staking rewards, and stablecoins would decrease confusion and invite more widespread involvement and use.
• United States policy shifts: The United States, under the Trump administration, could take the lead in implementing more crypto-friendly policies. With more guidance on altcoins and DeFi, and better clarity on digital asset taxation, institutional investors could enter the market, which is likely to drive demand throughout the altcoin space.

Counterpoints: Is It Already Late?

There have been many predictions of an imminent alt season throughout 2025 but as we see, the market has not reflected any of these expectations. So, when does the altcoin season actually start? Even if there is a rebound, some optimists now believe, there is little hope for such a result as in 2017 or 2021.

Bitcoin Dominance Resistance

A big part of what’s preventing the altcoin breakout right now is how Bitcoin dominance is carrying over into the recovery. A significant altcoin rally is said to occur when the bitcoin dominance undergoes a steep drop. Until then, altcoins could be the shadow of Bitcoin.

The last wave peaked at 64.6% before falling back to 64%. This is a trend that could push it to the 60% zone–an area that has previously marked the launch of altcoin momentum. The last time dominance touched 62% on May 14, altcoins went on a huge tear. If this trend continues, it might finally spark the highly anticipated alt season.

Reddit Skepticism

Here are the basic skepticism points we can notice in the Reddit community:

• Altseason is undefined. Users dispute how badly it is defined in fact.
• BTC dominance is still high. There are no definitive signals of altcoins rush under such a situation.
• Alt/BTC pairs are weak. Altcoins are not outperforming BTC
• It’s still too early for altcoins in the market cycle. Bitcoin still leading the run
• PTSD from 2021. The community is more cautious and jaded

How To Position Yourself For The Coming Altseason

It’s crucial to spot the signs that show early growth before the major alt season begins. Here are some things one should keep in mind.

Diversify Into Altcoins During Consolidation

So, take your time to carefully analyze and painstakingly choose the alts you want to buy. Speaking of diversified investing, altcoins can help you lower your risk and crank up your potential returns so you’re not all in on a single bet.

Watch Dominance & Index Indicators

Try to use a couple of technical analysis tools, such as support, resistance, and RSI, to establish the best entry and exit points. These are good alt season indicators, and can help you understand that the right moment for investment has already come and better understand what price movements and market sentiment are telling you.

Conclusion

While an alt coin season may still be in the offing, investors are advised to stay the course by conducting careful analysis and keeping abreast of market movements. Having the correct game plan in place will also be very important to capitalize when momentum does eventually change.

With a foggy macroeconomy in 2025, this cycle’s crypto alt season may look a bit different from the previous cycles we’re used to seeing unless we get some liquidity pumping. However, for patient investors, sector growth such as AI, DeFi, and Layer-2 performance can become interesting as money slowly but surely rotates through this sector.

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