- Altcoins are sending mixed signals.
- Market analysts are focusing on poor performance.
- Optimism for an altcoin season breakout remains high.
Bullish patterns in the cryptocurrency market typically follow those triggered by positive signals from Bitcoin (BTC) that spread to the broader asset class. But this time, the altcoin is struggling to gain any notable traction, having trouble keeping pace with Bitcoin’s recent surge.
The sluggish trend has raised industry-wide questions about what is causing the delays, and market experts are weighing in.
Why the altcoin season is later than expected
CryptoQuant founder and CEO Joo Ki-Young Ju provided insight into the continued underperformance of altcoins, identifying factors hindering the expected surge.
The key to the delay is the movement of capital flows into Bitcoin. Unlike past cycles, the current rally has been fueled by institutional investors and spot ETFs rather than retail traders, who have historically driven the circulation of funds from Bitcoin to altcoins. Institutions tend to hold Bitcoin for long periods of time and operate outside of traditional cryptocurrency exchanges, and the change in dynamics has halted the usual trickle-down effect of Bitcoin triggering altcoin rallies.
According to Ju, while some major altcoins are able to attract institutional attention through ETFs and investment funds, the majority of smaller altcoins still rely on exchange-focused activities. Without new retail interest, the much-anticipated altcoin season could still be difficult.
The analyst further highlighted liquidity issues in the altcoin market, where market capitalizations are lower than previous highs, meaning fewer new capital inflows. Without new investments flowing in, these altcoins may struggle to regain momentum.
Despite the obstacles, there is room for optimism.
Hopes remain for an altcoin season breakout.
Ju believes renewed excitement in retail and increased exchange activity could lead to a resurgence in altcoins. Optimism has been fueled by expectations that institutional interest in Bitcoin will expand and extend to altcoins, potentially triggering a long-awaited rally.
This reflects broader positive sentiment among other analysts. According to Rekt Capital, if the BTC price stabilizes within the $91,000-$100,000 range, there could be an opportunity for an Ethereum-led altcoin breakout.
The latest take builds on Rekt’s previous analysis that Bitcoin’s upward trend could create a positive environment for altcoins to thrive. However, CryptoQuant’s Ju emphasized that altcoins should focus on building independent strategies to attract new capital rather than relying solely on Bitcoin’s momentum.
On the flip side
- Some altcoins, such as Solana (SOL), have achieved impressive performance despite broad trends.
- Bitcoin has recently suffered a price decline, but has shown some recovery and is trading above $95,000 at press time.
Why This Matters
A bullish cryptocurrency market is incomplete without altcoin surges, so delays are a noticeable hindrance.
Learn more about expectations for altcoin surges.
Why Altcoin Season Is Next After Bitcoin-Breakout
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