Amid the ongoing crypto winter, most investors are looking for indicators and patterns to guide their entry and exit from the market while attempting to maximize profits. One of the monitored patterns is the altcoin season for alternative currencies known as altcoins, with indicators suggesting that this period might be on the cards.
In particular, as of September 19, 69% of the top 50 coins have outperformed Bitcoin (BTC) in the last 90 days highlighting that ‘altcoin season’ is in play, according to Blockchain Center data.
Notably, according to the Blockchain Center Altcoin Season Index, an altcoin season is declared once 75% of the top 50 coins perform better than Bitcoin over three months(90 days). The overviewed coins exclude stablecoins and asset-backed cryptocurrencies.
Bitcoin records negative returns
Among the top 50 coins, liquid staking solution for Ethereum (ETH), LIDO (LDO) is the highest performing altcoin at 222.4% in 90 days, followed by Chiliz (CHZ), the token fuelling the Socios.com fan voting platform at 154.6%. Elsewhere, Bitcoin has recorded losses of 6.6% over the period.
It is worth noting that the ‘altcoin season’ refers to a phase in the cryptocurrency market when altcoins outperform Bitcoin. However, this does not translate to guaranteed profits due to factors like market volatility. Therefore, the season offers an opportunity for crypto investors to diversify their portfolios.
In most cases, altcoins usually perform better during a bull market. Therefore, a significant number of altcoins outperforming Bitcoin might hint at a potential rally for both assets.
At the same time, previous altcoin seasons have coincided with Bitcoin registering a high market dominance. In most cases, the altcoin season is usually characterized by investors moving their capital from Bitcoin to other assets.
