the effect of an upcoming 'altcoin season', a period characterized by strong price increases of other assets compared to Bitcoin. During this time, investors often shift their attention and capital flows to altcoins.

Currently, several key indicators are gradually showing a shift in market dynamics. The following analysis will clarify some of these factors.

The altcoin season may have already begun

One of the notable indicators is the upward trend of TOTAL3, a measure of the total market capitalization of all cryptocurrencies except Bitcoin and Ethereum. As of now, this index stands at 933 billion USD, up 35% since the beginning of the month. To clarify further, the market capitalization of this asset group has increased by an additional 212 billion USD in just the past 22 days.

As TOTAL3 approaches its all-time high of 1.13 trillion USD, this indicates that investors are allocating more capital to altcoins. Notably, the rise of TOTAL3 occurs against the backdrop of Bitcoin's (BTC.D) dominance ratio undergoing a correction.

Data from the daily chart shows that BTC.D has fluctuated between 61% and 58% since November 8. Currently, BTC.D is at 59.30%.

When TOTAL3 rises sharply while BTC.D corrects, this is an important indicator suggesting the possibility of an altcoin season. This means that investors are shifting their attention from Bitcoin to other cryptocurrencies, leading to increased demand and altcoin prices potentially continuing to rise sharply.

Moreover, a new report from on-chain data provider CryptoQuant also indicates that the value of some Layer 1 altcoins has significantly increased since the U.S. presidential election, confirming that an altcoin season is gradually forming.

"Cryptocurrencies such as XRP, TRON (TRX), TON, ADA, and SOL have seen strong price increases, thanks to expectations that the new U.S. administration will have a more crypto-friendly policy," the report from CryptoQuant emphasizes.

In addition, CryptoQuant also explains that the increase in spot trading volume has accompanied this price surge.

"The daily spot trading volume of altcoins has significantly increased after the U.S. presidential election, reaching a peak of 18 billion USD on November 11 - the highest since early August. Previously, the spot trading volume of altcoins had remained low since May."

Altcoins may need more time

Although the above indicators suggest a high likelihood of an altcoin season occurring in the short term, it should be noted that this is only confirmed when at least 75% of the top 50 altcoins outperform Bitcoin over a three-month period.

However, data from Blockchain Center shows that only 43% of the top altcoins have outperformed Bitcoin in the past 90 days - much lower than the 75% threshold needed to officially declare an altcoin season.