Bitcoin (BTC) experienced a significant drop in price after reaching a new all-time high of $69,324 on March 5. Meanwhile, alternative coins, particularly memecoins and AI-themed cryptocurrencies, have been outperforming BTC, leading to discussions about whether the altcoin season (altseason) has arrived.
The total market capitalization of the cryptocurrency market surpassed $2.5 trillion when Bitcoin briefly crossed $69,000. Presently, the market value stands at $2.52 trillion according to CoinMarketCap.
Altcoins have also shown strength, with their total market capitalization exceeding $1.1 trillion on the same day. This metric measures the combined market value of all cryptocurrencies except Bitcoin. Over the past three months, this value has increased by about 64%, from $697 billion to $1.14 trillion on March 7. This outperforms Bitcoin’s 56% growth during the same period, indicating a growing interest in altcoins and their impressive performance.
Large-cap altcoins have been particularly successful compared to Bitcoin. Memecoins and AI tokens have seen significant gains over the past week, potentially signaling the beginning of the altseason. Memecoins like Dogecoin (DOGE) and Shiba Inu (SHIB) have posted gains of 20% and 130% respectively. Newer tokens such as Pepe (PEPE), Bonk (BONK), and Dogwifhat (WIF) have also experienced gains in the double to triple digits.
AI-focused tokens like Fetch.ai (FET), Synesis One (SNS), SingularityNET (AGIX), and Theta Network (THETA) have also seen substantial gains in the past week. In contrast, Bitcoin has only risen by 8.5% during the same period.
However, despite these developments, it is still too early to declare an altcoin season. The altcoin season index, which measures the performance of the top 50 altcoins compared to Bitcoin over the past 90 days, indicates that only 69% of them have outperformed Bitcoin. Although this index has increased recently, it is not yet sufficient to confirm the start of an altcoin season.
A market report by K33 Research suggests that this could change soon, comparing Bitcoin’s current rally to its previous all-time high in 2020 before altcoins caught up with its uptrend. Independent analyst CrediBULL discusses two possible scenarios for Bitcoin’s performance at the start of the altseason. One scenario involves a mega breakout where Bitcoin quickly doubles in value after breaking its prior all-time high, while altcoins rally after Bitcoin’s pause. The other scenario is a consolidation phase where Bitcoin revisits its prior all-time high but faces rejection or consolidation, leading to an immediate rally in altcoins.
Some experts believe that the altcoin season has not yet begun. Michaël van de Poppe, the founder and CEO of MN Trading Consultancy, suggests that altcoins still have a 40-60% market capitalization to reach the highs of 2021, which surpassed $1.1 trillion. Cardano founder Charles Hoskinson believes that the altcoin season will commence once Dogecoin surpasses ADA in market capitalization.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research before making any investment decisions.