Bitcoin (BTC) has led the cryptocurrency rally this year, but there are early signs that “altcoin season” is approaching, with smaller tokens starting to outperform, analysts said.
BTC is already close to its all-time high set in 2021, reaching $64,000 this week alongside strong inflows into spot Bitcoin ETFs.
However, this may soon change, according to a new market report by K33 Research. “Looking at history, altcoins will start to perform better than we are right now,” K33 wrote. The report noted that since the market bottomed in November 2022, Bitcoin's market value has doubled compared to the total value of all cryptocurrencies except BTC and Ethereum (ETH). According to analysts, this situation is similar to the situation in late 2020, before altcoins started to catch up with BTC's rise.
They added that this week's “massive” memecoin rally could be a “possible early sign” of the upcoming altcoin season. However, the report noted that the timing of the altcoin season is a “risky area” as Bitcoin ETFs change the crypto investment landscape, and there is no guarantee that money flowing into Bitcoin will eventually flow into smaller assets.
“There is enough risk appetite to send a select few altcoins higher, but we have yet to see a new wave of retail investors entering the altcoin arena to create the wave that lifts all boats,” K33 said.
*This is not investment advice.
