Altcoin investors are experiencing a severe 'winter.' After the price correction of Bitcoin (BTC), the altcoin market has generally fallen into significant discounts, with the altcoin season index dropping below 50%, reaching a monthly low. Does this mean the altcoin frenzy is over? Here are the warning signals currently being sent by the market.

1. The Threat to Bitcoin's Dominance

Recently, Bitcoin's market dominance (BTC Dominance) has consistently remained above 54% and may continue to rise. On-chain analyst and Alphractal founder Joao Wedson points out that this trend is 'a bad signal' for altcoins. As more funds flow into BTC and stablecoins, the liquidity and demand for altcoins are bound to be impacted.

Wedson even bluntly stated:

"The best strategy is to continue holding stablecoins instead of BTC or altcoins. The ideal exit point is when BTC breaks $106,000 – that is when it's time to exit all assets!"

2. Overall Performance of Altcoins is Weak

Since the brief altcoin frenzy in November, most altcoins have struggled to maintain their gains. Over the past week, the prices of most top and mid-tier altcoins have plummeted by 10%-30%:

  • XRP: Down nearly 10%, but still above $2.

  • ADA: Plummeting 18%, falling below $1.

  • ETH: Relatively stable, down only 6%, holding the $35,000 support level.

Even so, individual projects like Hyperliquid (HYPE) and Pudgy Penguins (PENGU) have become highlights, rising by 40% and 425% respectively, but this is more like an anomaly in a sluggish market rather than a trend reversal.

3. Altcoin Season Index Falls into Dangerous Zone

The decline in the altcoin season index indicates that market funds are flowing more towards BTC rather than altcoins. This usually means that the altcoin market lacks the momentum for independent growth and may struggle to break free from Bitcoin's 'dominance pressure' in the short term. Particularly, when Bitcoin's 90-day dominance change turns positive, the outflow of funds from the altcoin market exacerbates this dilemma.

4. Decline in Investor Confidence

The altcoin market is currently under the pressure of bearish sentiment. Although many analysts predict that a 'Christmas rally' could boost altcoins, on-chain data and market flows suggest that this hope may be more wishful thinking. Compared to a short-term rebound, a more likely scenario is a stronger recovery for altcoins in 2025.

Wedson warns:

"Under the current trend, altcoins are unlikely to bounce back strongly from the recent adjustment, and investors should remain cautious."

Is the altcoin season really over?

The future of altcoins is not entirely bleak, but they do face many challenges in the short term. Bitcoin's dominance and capital flows have put pressure on the altcoin market, coupled with macroeconomic uncertainties, most altcoins may struggle to show significant improvements in the short term. However, this situation may also provide better positioning opportunities for investors – the market never lacks for frenzies; what it lacks is patience to wait for the right chips.

What do you think about the future of altcoins? Feel free to leave your thoughts in the comments and discuss with everyone!
#加密市场盘整 #市场调整後的机会？ #比特币市场波动观察 #比特币战略储备 #圣诞行情预测 $BTC $ETH $SOL