The altcoin season usually begins after a significant increase in the price of Bitcoin (BTC), when BTC's dominance in the market decreases and capital flows into altcoins. This happens during certain periods of the cryptocurrency cycle when investors look for higher returns in less capitalized assets.
How to determine the beginning of the altcoin season?
1. Bitcoin dominance is declining: If BTC dominance falls below 45-40%, this may indicate the rise in popularity of altcoins.
2. Sharp rise in altcoins: Several major altcoins are starting to show significant gains in a short period.
3. Growing interest in DeFi, NFT, Layer 2 solutions: The altcoin season may be driven by the popularity of specific sectors of the cryptocurrency market.
Which altcoins are worth considering?
The choice depends on your strategy (short-term or long-term) and the level of risk you are willing to accept.
Potentially promising areas:
1. Ethereum (ETH)
• A leader among altcoins, especially due to its role in smart contracts, DeFi, and NFTs.
• With the release of updates (Ethereum 2.0), demand increases.
2. Layer 2 solutions:
• Polygon (MATIC), Arbitrum (ARB), Optimism (OP) — these projects reduce transaction costs on the Ethereum network.
3. Blockchain Scaling Solutions:
• Solana (SOL): Known for fast transactions and low fees. Popular among the NFT community.
• Avalanche (AVAX): Supports many blockchains in its ecosystem.
4. DeFi projects:
• Aave (AAVE), Uniswap (UNI) are leading platforms in the field of decentralized finance.
5. Metaverse and GameFi:
• The Sandbox (SAND), Decentraland (MANA) are popular in the world of metaverses.
• GALA (gaming platforms) is also worth considering.
6. Innovative projects:
• Chainlink (LINK): Focused on decentralized oracles.
• Quant (QNT): A project to ensure compatibility between different blockchains.
7. Meme coins (high risk):
• Dogecoin (DOGE), Shiba Inu (SHIB) — their value often depends on hype and social media.
What to do now?
1. Research the market: Study the fundamental and technical characteristics of coins.
2. Risks: Altcoins are significantly more volatile than Bitcoin, so only invest what you are willing to lose.
3. Diversify your portfolio: Don't put all your money in one asset.$ETH
