As a seasoned researcher with over a decade of experience in the crypto market, I find myself constantly intrigued by the cyclical nature of altcoin seasons. From my perspective, these phenomena will undeniably persist, serving as a thrilling rollercoaster for speculative investors. However, the intensity and frequency of returns are likely to decrease as the market matures and becomes less volatile.
It is likely that periods of increased activity in alternative cryptocurrencies (crypto altcoins) will continue, bringing joy to those who speculate on cryptocurrency, but over time, the level of return may decrease as the crypto market becomes more established, as predicted by a crypto expert.
As a researcher delving into the world of cryptocurrency, I find myself echoing the sentiments expressed by the pseudonymous trader Willy Woo in an Oct. 26 post. He suggested that future altcoin seasons may show a decline in strength with each subsequent cycle, starting from the significant altcoin bubble of 2017. This was a period marked by the surge of Initial Coin Offerings (ICOs), a method through which projects seek funding by offering cryptocurrencies for investment, much like the early days of the IPO boom in traditional finance.
Altcoin seasons will continue as investors chase higher-risk returns
Willy Woo made it clear that he’s not predicting an absence of altcoin seasons. Instead, he stated confidently that following a surge in Bitcoin’s (BTC) value, you can expect mid-tier and lower-cap cryptocurrencies to experience growth or “pump,” as investors tend to seek higher returns with increased risk.
Typically, traders keep an eye out for indications that the influence of Bitcoin might be reaching its maximum, which they interpret as a signal to gradually shift their investments towards other cryptocurrencies, often referred to as altcoins.
Based on data from TradingView, Bitcoin‘s dominance currently stands at approximately 59.31%. This figure is nearly reaching the 60% threshold that some analysts have forecasted. They speculate that once this level is reached, capital may begin to shift towards alternative cryptocurrencies (altcoins).
According to Willy Woo, this ongoing cryptocurrency cycle seems to focus more on meme-based coins, which he considers as a playful jab at the overall crypto market.
The comments oppose those made by Mati Greenspan, the founder of Quantum Economics, who recently told CryptoMoon that the “upcoming bull run will be all about Bitcoin and its layer 2s.”
Willy Woo warns against HODLing altcoins
Willy Woo emphasized that the technology in question isn’t being deceptively presented as groundbreaking and life-altering; rather, he described it as more akin to a gambling casino within a bubble. Given this perspective, he advises his 1.1 million followers to avoid taking long positions on altcoins.
“Don’t ever hodl them unless you’re so knowledgeable that you’re an effective insider because alts are an insiders game just like the casino where the house will eventually win.”
He also warned that the alt market cap reflects the “winners,” not the failed tokens.
Willy Woo also pointed out that the total market capitalization is similar to a cricket bat that has been repeatedly redesigned with new handles and blades. In this analogy, each new design represents a new winner in the market, while the losers are not factored into the market cap.
numerous cryptocurrency experts are discussing the possible timeline for when we might officially announce that an ‘altcoin season’ is underway.
From my perspective as an analyst, it’s a common assumption among traders that Bitcoin needs to surpass its previous all-time high of $73,679 (achieved in March) for altseason to occur. However, I personally believe that reaching the old peak may not be sufficient on its own to spark altseason this time around.
According to analysts at Hashkey Capital, it’s more likely that the market for alternative cryptocurrencies (altcoins) will flourish if the price of Bitcoin exceeds $80,000.
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2024-10-27 10:08