The long-awaited altcoin season (altseason) may enter a pause phase for a while. The significant decrease in capital flows into the cryptocurrency market seems to have led to the postponement of the altseason.
Tokens such as BNB and AAVE are expected to maintain their upward expectations despite this pause.
While the cryptocurrency market is showing signs of slowing altseason, BNB and AAVE are moving resiliently, with their market caps falling to $3.33 trillion amid liquidity issues.
According to Glassnode, there has been a noticeable decrease in capital flows in the cryptocurrency market, indicating that investors are not actively entering the market and there is a general lack of investment.
According to Aggregate Market Realized Value Net Position Change data, capital flows have seen a significant decline, falling from $134 billion to $100 billion on Dec. 10. Such a decline suggests that the market is generally lacking a bullish bias for most cryptocurrencies. Instead, investors seem to be opting for stable assets rather than buying risky tokens. This could increase the likelihood of further declines in the market.
Despite this decline in total capital flows, some tokens are predicted to maintain their bullish momentum and outperform the overall market.
BNB Heads Towards New Highs$BNB
BNB continues to be one of the best-performing crypto assets in 2024, managing to reach all-time highs twice during the year. After reaching its previous peak of $691.77 in 2021 and reaching $721.80 in June 2024, BNB reached a new record high of $793.86 in December 2024. Currently, BNB is in the accumulation phase, as can be seen from the chart patterns. If it breaks out of this phase, another rally can be expected to be triggered and it can set new targets by exceeding the $800 level.
AAVE Remains Structurally Bullish$AAVE
AAVE’s price chart has continued its bullish position. Following market consolidation, AAVE surged 332.78% in January to $399.85, a level last seen in 2021. On December 17, AAVE reached a new peak in terms of Total Value Locked (TVL) at $23.19 billion, but it soon fell back to $20.63 billion. This small decline suggests that AAVE maintains its fundamental bullish outlook and that activity on the protocol is increasing. If TVL stabilizes or increases, AAVE’s price could continue to maintain its upward momentum. This could have a positive impact on the price, especially as the platform continues to play a central role.
The main condition for an altcoin season to rise is a decline in Bitcoin Dominance. Bitcoin Dominance measures how Bitcoin is performing compared to other altcoins in the market. When Dominance is high, Bitcoin is outperforming most altcoins. Conversely, when Bitcoin Dominance drops, altcoins may perform more strongly.
At the time of writing, CoinMarketCap reports that Bitcoin Dominance has decreased by 0.18% to 56.94%.
As long as Bitcoin Dominance remains relatively high, altseason is likely to be postponed. At least, until Bitcoin Dominance drops below 50%, this situation can be expected to continue.