Altcoin Season Alert: Coinbase Sees Growing Potential for Altcoin Rally This Fall
According to Coinbase, altcoins have grown significantly in recent years, and the state of the cryptocurrency market indicates that interest in cryptocurrencies other than Bitcoin may soon shift. The company said that altcoin season occurs when at least 75% of the top 50 altcoins by market capitalization perform better than Bitcoin (BTC) throughout the previous ninety days.
We think current market conditions now suggest a potential shift towards a full-scale altcoin season as we approach September,
Coinbase Institutional’s global head of research, David Duong
Indicating an impending altcoin season, the Coinbase analyst joined an increasing number of traders and market watchers. Duong went on to say that a sizable amount of retail capital was resting on the sidelines in money market funds, and that in the medium run, Federal Reserve easing might allow for more retail participation.
Crypto Market Poised for Altseason as Bitcoin Loses Market Share
The odds of a Fed rate cut in September have increased to 92% on futures markets as a result of this week’s July US Consumer Price Index (CPI), which showed inflation maintaining steady at 2.7% year over year. Lower interest rates have the ability to attract new investors and act as a stimulant for high-risk assets like cryptocurrencies.
The fall in Bitcoin’s dominance or overall market capitalization share is another element impacting the onset of altseason. The market dominance of Bitcoin decreased by over 10% from over 65% in May to 59% in August. According to TradingView, the dominance of Bitcoin is currently at 59.5%, which is about the lowest level since late January.
This is the first sign that capital is beginning to shift to altcoins.
Duong
CoinMarketCap Index Signals Early Altseason Momentum
Although altcoin season indices have been increasing, they are still far below the 75-point mark that has previously been used to identify altseasons. Despite this, the cryptocurrency market cap has surged by nearly 50% since early July, Duong observed. In July, CoinMarketCap’s Altcoin Season Index was around 25, but it is now at 44. According to Duong, stablecoin narratives and digital asset treasuries are driving the present surge. He went on to say that growing institutional interest is shown in the discrepancy between altseason indexes and the total altcoin market size.
With the altcoin market cap climbing and the Altcoin Season Index showing early positive signals, we believe conditions are setting up for a potential rotation into a more mature altcoin season as we head into September.
Duong
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