Altcoin Season is a period in the cryptocurrency market when alternative cryptocurrencies (altcoins) begin to rise actively, sometimes outpacing Bitcoin (BTC) dynamics. It consists of five phases, each with its own characteristics:
Bitcoin (BTC) Phase
Main Features:
Bitcoin is actively growing, demonstrating high reliability as the main market asset.
BTC dominance in the market reaches a peak as capital is predominantly concentrated in it.
What's happening:
Investors bet on Bitcoin as a "safe haven."
This stage attracts the attention of new participants to the cryptocurrency market.
2. Phase of Major AltcoinsMain Features:
Capital begins to flow into leading altcoins (for example, #Ethereum , #XRP ).Bitcoin dominance is decreasing.
What's happening:
Institutional investors and high-risk traders start investing in reliable altcoins.Altcoins show significant growth as they are considered the next safe choice after Bitcoin.
3. Phase of Old Altcoins
Main Features:
Growth is observed in old altcoins with established communities.These are coins that have already survived one or two previous alt seasons.
What's happening:
Traders return to these coins, believing they can reach their all-time highs again.
Such coins receive an influx of capital due to nostalgia and traders' familiarity with them.
4. Phase of New Tokens
Main Features:
Active growth of new low-cap tokens with little history."Gems" (unknown coins capable of significant growth) emerge.
What's happening:
There is already a lot of liquidity in the market, and fear of missing out (FOMO) peaks.
The greatest growth occurs in new and little-known projects, attracting small investors and speculators.
5. Phase of Profit Taking
Main Features:
Bitcoin dominance begins to recover.
The market enters a phase of maturity and subsequent decline.
What's happening:
Investors massively take profits by selling their altcoins.
The market begins a correction, returning to more stable levels.
Key Takeaways:
Cyclicality: The alt season always follows a certain logic, allowing experienced traders to predict market movements.
Risks and Rewards: The further the phase, the higher the potential rewards, but risks also increase.
Profit Taking: Success in the alt season often depends on the ability to exit the market on time.
Understanding these phases helps traders manage their portfolios more effectively and make informed decisions.
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