The Altcoin Season Index is an important indicator for gauging the phase of the cryptocurrency market. Current data shows we are in a Bitcoin-dominated phase.
What is the Altcoin Season Index?
The Altcoin Season Index is a metric that shows the comparative performance of major altcoins against Bitcoin over a defined period.
- **Source:** Data is tracked by CoinMarketCap, based on a broad market spectrum. - **Scope:** The index focuses on the top 100 cryptocurrencies by market capitalization, excluding stablecoins and wrapped tokens. - **Timeframe:** It analyzes performance over the past 90 days. - **Comparison:** The core of the index is a direct comparison: how many of the top 100 altcoins have outperformed Bitcoin during that window.
Seasonal Breakdown: Altcoin Season vs. Bitcoin Season
The index uses specific thresholds to define the prevailing market ‘season’. Here’s how the seasons are defined:
- **Altcoin Season:** This occurs when at least 75% of top 100 altcoins outperform Bitcoin, registering an index score of 75 or higher. - **Bitcoin Season:** Occurs when 25% or fewer of the top 100 altcoins outperform Bitcoin, registering an index score of 25 or lower. The current reading of 22 clearly indicates Bitcoin Season.
Historical Context: When Have We Seen Altcoin Seasons?
True altcoin seasons are infrequent compared to Bitcoin-dominated periods. Notable altcoin seasons include:
- **Late 2017 / Early 2018:** Iconic altcoin season driven by the ICO boom. - **Mid-2020 to Early 2021:** A strong altcoin season following the market crash of March 2020 and leading into Bitcoin's rise. - **Parts of 2021:** Distinct periods where altcoins significantly outperformed Bitcoin, often tied to specific narratives.
The Altcoin Season Index provides valuable insights into market dynamics. The current state indicates Bitcoin dominance, requiring investors to be strategic and adaptive in their approaches.
