Written by: BowTied Bull
Compiled by: Plain Blockchain
As we approach 2025, the transition between the old and the new naturally prompts us to summarize the past and look to the future.
Looking back at the past of the crypto industry, an interesting phenomenon emerges: every four years, there is a 'altcoin season' during which everything in the industry tends to rise. You might hear that your alcoholic uncle made a fortune on some animal meme while being drunk at the same time.
By 2025, the true altcoin season can be said to not have fully arrived. While no one can predict how crazy this altcoin season will be, I want to remind everyone that the trends in altcoin markets tend to spiral out of control quickly and may end suddenly. Once a crash happens, the decline may not just be -99.99%, but could even lead to complete collapse.
However, before that, everyone was immersed in an atmosphere of prosperity and entertainment. So, let's take a look back at past altcoin seasons to see how they developed and whether we can glean some valuable lessons from them.
2012-2013 Altcoin Season: Early fervent investors, with a peak market cap of $1.5 billion.
We know that those who blindly follow trends in the current market are likely to emerge again. This happened in 2013, and the trends became very interesting.
During the 'altcoin season' of 2013, Bitcoin was still in its early developmental stage, with a total market cap of about $1 billion, and a whale trade would only cost about $100,000. At that time, the CEX Mt. Gox was still operational, and most investors were those who frequently participated in trading card activities at (Magic: The Gathering) events (this also provides the background for the Mt. Gox incident).
At that time, people proposed ideas to improve Bitcoin's transaction speed, believing that reducing block time could accelerate transactions, which was considered a far-reaching innovation at the time.
Litecoin: Still exists today, and the whole idea (proposed by Charlie Lee) was to shorten the block time from Bitcoin's 10 minutes to 2.5 minutes.
Litecoin's price rose from about $0.10 to $48, a rise of about 47,900%, and experienced another significant surge in 2017, after which Charlie Lee sold all his holdings at the top, claiming 'without him, the Bitcoin network is still doing fine.' (Everyone knows what it means when a founder sells 100% of their holdings.)
Namecoin: This is a fork of Bitcoin aimed at creating decentralized network domains (similar to the ENS concept with '.eth' extensions). Its price once soared to about $13 but quickly fell into a trough. From its lowest point to its highest point, its price increased by about 30 times. In fact, it still exists today, with the current trading price close to $1.
Peercoin (PPC): One of the earliest proof-of-stake tokens (this mechanism is now used to secure ETH), it experienced two major surges. The first was in 2013, and the second in 2017 during the ETH ICO frenzy. Its price once soared to about $7, achieving a 60-70x increase. Naturally, it did not gain mainstream adoption and eventually fell to $0.42. (However, the conclusion I want to draw is that, apart from pure Ponzi schemes like Bitconnect or LUNA, other things in the current market will not really go to zero.)
Frenzy: Bitcoin ultimately reached $1,200, and these cryptocurrencies rose due to increased interest in crypto. Any project posting on BitcoinTalk could quickly rise based on speculation. The closest thing to this today might be a Memecoin promoted by a celebrity or a Memecoin named after a celebrity.
Mt. Gox Collapse: When Mt. Gox collapsed, the party ended. This collapse was due to a major hacking attack, causing Bitcoin's price to plummet significantly, dropping about 85-90% (depending on your perspective on the bottom), while Altcoins experienced declines of over 99%.
2017 Altcoin Season: The ICO frenzy and the rise of Ethereum, with a peak market cap of $800 billion.
Subsequently, many interesting events occurred during the bear market. Ethereum was born as a smart contract platform aimed at creating programmable money. This was a true innovation as it allowed not only the transfer of tokens but also the creation of smart contracts, fundamentally changing the entire game.
Like many things in the cryptocurrency space, Ethereum also comes with common risks. The DAO (Decentralized Autonomous Organization) of Ethereum was hacked, resulting in losses of over $100 million, ultimately leading to a hard fork that created the ETH and ETC chains. To this day, some still believe that the fork decision at that time was a mistake, but we do not intend to discuss this now; we simply revisit this part of history.
By around 2016, people realized that new tokens could be issued on the Ethereum blockchain, giving rise to Initial Coin Offerings (ICOs). In an ICO, project teams directly sell tokens to investors. In 2017, the ICO frenzy officially erupted, and many scam projects you can think of emerged at this time.
Ethereum (ETH): The rapid rise in ETH prices was driven by the issuance of these tokens, skyrocketing from about $8 to $1,400 in January 2018, which was an almost unimaginable return at the time. Currently, ETH is trading at approximately $3,650.
Ripple (XRP): Ripple is still seen as the 'banker's coin.' The theory is that Ripple will replace SWIFT (the international funds transfer system) overnight, becoming the de facto financial standard. Although Ripple is centralized (most people don't mind), it still attracts millions of funds. Ripple's price soared from about $0.01 to $3.80, with a current trading price of $2.41.
Strangely, the investor community for Ripple is still primarily retail investors. In a recent wave of price increases, a similar phenomenon can be observed — Ripple dominated discussions on TikTok, attracting a lot of engagement, with some even asking, 'What if its market cap reached the same level as Bitcoin?' This discussion about a 'trillion-dollar market cap' is somewhat bewildering.
Litecoin: As mentioned earlier, Litecoin experienced another rise, with its price soaring to $360. Despite Charlie Lee selling all his Litecoins, it still surged to $384 in 2021!
EOS: EOS raised $4 billion through an ICO, branding itself as the 'Ethereum killer.' Its price once skyrocketed to $22 but has since failed to reach new highs.
NEO: Another project that touts itself as an 'Ethereum killer,' it is known as 'China's Ethereum,' with NEO's price rising from $0.20 to $200, achieving a 1000-fold return.
Bitcoin Cash: Roger Ver was a well-known figure in the Bitcoin community; he participated in the big block debate and supported Bitcoin Cash. When block 478,559 was reached in August 2017, users holding 1 Bitcoin would receive 1 Bitcoin Cash. Due to Roger Ver's support, Bitcoin Cash's price once soared to about $3,800 but gradually faded from public view.
Other Ethereum Killers: During this period, other tokens were also promoted as 'Ethereum killers' (like ADA, Tron, etc.). If a token has a 'whitepaper,' it seems to drive its price to achieve 10x or even 100x surges. Other tokens, like Filecoin and Tezos, also launched during this time.
Yield scams: If you think BlockFi, LUNA, Celsius, and Voyager were the first yield scams, you are mistaken! In fact, the first large-scale yield Ponzi scheme was Bitconnect, causing many to lose millions.
Regulatory intervention: Just like in the 2021 cycle, the intervention of regulators and the outbreak of Ponzi schemes again devastated the entire industry. The U.S. Securities and Exchange Commission (SEC) began investigating projects like EOS, and the market experienced a solid 85% pullback, with Bitcoin's price falling to about $3,500 by March 2020.
At that time, most tokens were just scams, leading the Altcoin market to experience an almost -99.999999% crash. Back then, if your token appeared in a Super Bowl ad, its price could instantly rise fivefold. For example, VIBE is a typical case.
VIBE's price once soared from $0.04 to over $2, but ultimately its total market cap fell to just $262.
2021 Altcoin Season: DeFi, NFTs, and Memecoins, with a peak market cap of $3 trillion.
In 2021, due to well-known reasons, everyone worked from home, staring at computers and phones idly. The U.S. government printed $10 trillion in currency, and that was just the U.S. government's spending.
DeFi projects have fueled liquidity mining, NFTs have made JPEG images mainstream (selling for millions of dollars), and the valuations of Memecoins have reached absurd levels. Bitcoin broke through $69,000, ETH reached $4,800, and the total cryptocurrency market cap surpassed $3 trillion in November 2021.
Dogecoin: Initially just a joke, its price began to skyrocket as Elon Musk showed interest, becoming a hot topic on the forum platform Reddit. Today, it has almost become Elon’s meme coin, representing government efficiency departments. Its price soared from about $0.005 to $0.74, a rise of about 15,000%.
Solana: Marketed as the next 'Ethereum killer,' it attracted a lot of attention with its fast transaction speeds and low fees. All of this was mainly promoted by SBF (now imprisoned). Its price surged from $1 to about $260, a 26,000% increase.
Shiba Inu: A meme coin that imitates Dogecoin, creating a number of millionaires. In terms of its nearly zero market cap, it achieved a rise of 500,000%.
DeFi Tokens: The price increase of DeFi tokens like AAVE, UNI, SUSHI, and YFI ranges from 10x to 50x, with decentralized finance (DeFi) total value locked (TVL) surpassing hundreds of billions of dollars. Today, many DeFi projects have a TVL even higher than at that time!
NFTs:
CryptoPunks: Sold for millions of dollars, the cheapest CryptoPunk price exceeds 100 ETH.
Bored Ape Yacht Club (BAYC): Became a cultural phenomenon, with minimum prices reaching unbelievable levels.
Airdrop Frenzy: For some long-time users of certain projects, simply owning a $100 .eth domain could yield a $40,000 airdrop. You could even earn a 2% return within a day or a week just by crossing a bridge (performing certain actions). NFT projects like BAYC also airdropped large amounts of other high-valued NFTs, with the entire airdrop amount reaching billions of dollars.
Even crazier is… almost all tokens were rising, with tokens like SAFEMOON being endorsed by figures like Dave Portnoy. Celebrities like Snoop Dogg and Paris Hilton also endorsed various projects. Tom Brady and Stephen Curry promoted cryptocurrency exchanges. Even the now-defunct FTX once spent money to acquire naming rights for the Miami Heat. FTX (now defunct) even bought naming rights for the NBA Miami Heat.
Ponzi schemes: A large number of Ponzi schemes emerged. While some blame us for being associated with these scams, we were not involved. Fortunately, many people successfully avoided significant losses. Investing in these products and entrusting your assets to others has never been a wise choice.
Death Spiral: As liquidity began to dry up (the funding that previously supported these projects was no longer available), we witnessed the collapse of the aforementioned Ponzi schemes. In addition, FTX collapsed due to misappropriating user funds, followed by the U.S. Securities and Exchange Commission (SEC) stepping in again for regulation. Various large-scale scams and rug-pulls ultimately led the crypto industry into a strict regulatory period.
Key Lessons
1) Take profits in a timely manner: The market changes rapidly, and you are likely to feel greedy. If you find yourself saying 'I wish I could buy 2x of that token,' then what you should probably do is sell half your position and contentedly take the profits. Selling Bitcoin, Ethereum, or stablecoins doesn't matter; the key is not to be greedy.
2) The hype cycles are repetitive: Each altcoin season has a narrative theme: Bitcoin forks, ICOs, DeFi, NFTs, or Memecoins. If you find a theme, it's best to stick with it because the knowledge you've accumulated in that area often disappears swiftly at the end of the cycle. Rather than jumping around, focus on one area and reap the ultimate victory.
3) Risk management is crucial: The potential returns are substantial, but everyone's situation is different. You are not the same as me, and I am not the same as my neighbor. Create a suitable plan for yourself and stick to it; do not keep adjusting your goals just because someone with $100,000 says '10 million isn't enough to retire.'
4) Survivors will thrive: Altcoins come and go, but Bitcoin and Ethereum dominate in every cycle. If a project has existed for so long, its risk of going to zero is relatively low. If Solana can find practical applications beyond Pump.fun by 2025, it might also reach that level.
What have we learned from Ponzi schemes? Actually, nothing. From what we've seen, people still do not understand the concept of 'Not Your Keys, Not Your Coins.' You can buy crypto stocks or other leveraged crypto assets through brokerage firms, but understand that if you hold these stocks or crypto ETFs, you don't actually own any cryptocurrency. You will never know how these companies or projects will handle the assets you invested.
During bull markets, we often face criticism for not participating in the hype of the latest Memecoins. While these speculative activities may seem hot right now, if you look closely, you'll find that those who stick to their strategies and remain calm have gradually begun to accumulate.
In contrast, speculators who only think about getting rich quickly through '10x returns' may attract market attention in the short term, but their funding and strategies cannot compare to those anonymous whales who steadily invest and accumulate wealth every month. These whales usually have a more solid financial foundation and clearer long-term plans. Ultimately, market performance and data will prove which strategies are the key to success.
Finally, I wish everyone good luck in 2025.
