The crypto market has reclaimed the $2.5 billion mark, with some altcoins outperforming the market as a whole. Bitcoin (BTC) is approaching $80,000, indicating a shift towards positive sentiment in the crypto market.
Analysts expect a bigger altcoin season than previous cycles. Here’s why.
Altcoin volume explodes
Altcoin volume is reaching levels not seen in previous cycles. The CEX volume ratio for non-BTC to BTC excluding stablecoins is 7, up from around 4 between 2019 and 2021.
The upward trend in altcoin volume on a monthly scale during the year has exceeded the 5 mark.
This suggests that this season could be much stronger than the previous cycle. When trading volume is high at the bottom of the range, it is a sign of bullish momentum.
Although the volume indicated a potential bull market, it did not guarantee a parabolic rally. The liquidity of individual altcoins on platforms like Uniswap (UNI) was still declining.
Analyst predicts 60% rise
Michael van de Poppe, the founder of MN Fund, supported the bullish projection. The analyst predicts 30-60% upside potential if Bitcoin price reaches $86,000. Indeed, liquidity would rotate towards categories such as AI, memes and DeFi, among others.
Michael noted that almost everyone was unaware of some upward momentum. He suggested that these alternative crypto investments could generate a ton of returns.
The growing momentum was evident on the Altcoin Season Index. The index rose from 25 to 41 in a month, suggesting that more altcoins were starting to outperform BTC.
However, the real altcoin season occurs if the index hits 75 or higher.
Is altcoin season coming?
On the charts, the market capitalization of alts excluding Bitcoin, Ethereum (ETH) and stablecoins confirmed a breakout.
They have broken out of a multi-month descending trendline after consolidating since early February. This took the market capitalization above the $742 billion mark.
If the season actually begins, the market capitalization of these altcoins could potentially reach $1 billion. In 2021, a similar breakout marked the start of a massive rally. However, this rally faces resistance in the $760 billion area.
Overall, there were enough signals to anticipate a much bigger rally than the last. However, recovery depends on market dynamics for 2026.
Final summary
- Altcoin volume is exploding, surpassing that of previous cycles, as analysts eye a bigger altcoin season.
- Altcoin market cap confirmed a breakout of months-long trendline resistance.
