What is Altseason? An overview of the altcoin market cycle

Cryptocurrency markets operate in clear cycles, with altseason being a period that the expert community pays close attention to. This timeframe is defined by the outperformance of altcoins in terms of value and trading volume compared to Bitcoin—a phenomenon marking a significant shift in how investors allocate their capital.

As of February 2026, the cryptocurrency market is in a strong recovery phase. Bitcoin is trading at $67,880, while Bitcoin dominance remains at 55.68%. Market optimism has been sparked by positive regulatory developments, including the SEC’s approval of a spot Ethereum ETF in 2024 and the Bitcoin halving event that occurred during the same period. These factors have created an ideal environment for altseason to kick off, with capital beginning to shift from Bitcoin to other cryptocurrencies.

Altseason: When Altcoins Outperform Bitcoin

Altseason is understood as a period when the total market capitalization of all altcoins (cryptocurrencies other than Bitcoin) surpasses Bitcoin in price gains during a market rally. The key difference between altseason and other phases is that investor focus is no longer solely on Bitcoin—often called “digital gold”—but extends to a range of promising projects.

During altseason, driving factors include speculative trading frenzy, the launch of advanced technological projects, and increased investor interest in new sectors. This often occurs after Bitcoin has risen significantly, making its price less accessible to retail investors. Instead of being discouraged, they shift their attention to promising altcoins where higher profits may be found.

Altseason vs. Bitcoin Season: Capital Shift in the Market

To understand altseason, it’s important to distinguish it from Bitcoin season—a phase where the market’s main focus is entirely on Bitcoin. This difference is most clearly reflected in the Bitcoin dominance index—an indicator comparing Bitcoin’s market cap to the total crypto market cap.

In Bitcoin season, Bitcoin dominance rises sharply, indicating that investors prefer Bitcoin over altcoins. This trend often stems from bear markets, when pessimism prevails, or from concerns about market uncertainty. During such times, investors tend to flock to Bitcoin or stablecoins as safe assets.

Conversely, altseason begins when Bitcoin dominance drops below 50%—a critical threshold signaling a significant capital shift toward altcoins. During this phase, altcoin trading volume surges, and their returns often far exceed Bitcoin’s. It’s a period when market sentiment broadens beyond basic blockchain technology fundamentals, reflecting investors’ hunger for new growth opportunities.

Notable Historical Altseasons

The history of the crypto market records three distinct altseason periods, each with unique characteristics.

Late 2017 – Early 2018: The ICO Boom

This period saw Bitcoin dominance plummet from 87% to 32% by January 2018—an all-time low. Meanwhile, total crypto market cap exploded from around $30 billion at the start of 2017 to over $600 billion in 2018, with many altcoins reaching all-time highs (ATH).

This phase was characterized by the initial coin offering (ICO) craze, where numerous new projects launched and attracted large speculative investments. Many altcoins had no real economic basis but still surged in value due to market hype.

Early 2021: The Rise of DeFi, NFTs, and Memecoins

Bitcoin dominance declined from 70% to 38%, while altcoin market share increased from 30% to 62%. This period was driven by three main trends: the explosion of decentralized finance (DeFi), the NFT (non-fungible token) craze, and the rise of memecoins.

The most benefited altcoins included Solana, Polygon, Dogecoin, Shiba Inu, PancakeSwap, and BNB—projects representing emerging sectors or with practical DeFi applications. Total crypto market cap first surpassed $2 trillion, with Bitcoin reaching $69,000 before crashing later that year.

2023–2024: Altseason Triggered by Bitcoin Halving and Ethereum ETF

The current period differs from previous ones, with key catalysts being the Bitcoin halving (which occurred in April 2024) and the approval of Ethereum ETF in May 2024. Unlike ICO, DeFi, or NFT-driven altseasons, this phase features broader sectors such as AI, GameFi, metaverse, DePIN (decentralized infrastructure), and Web3, with notable projects.

Altcoins like Arweave, JasmyCoin, DogWifhat, Worldcoin, and Fetch.ai have experienced significant price increases, illustrating the cyclical nature of altseason and the evolving crypto market.

Recognizing Altseason: Key Indicators

While there’s no foolproof formula to predict altseason, investors can watch for several indicators:

Significant rise in altcoin dominance: When the total market cap of all altcoins increases sharply relative to Bitcoin, it suggests capital is shifting. This often coincides with Bitcoin dominance falling below 50%.

Surge in altcoin trading volume: A noticeable increase in trading activity across various altcoins signals growing interest and potential entry into altseason.

Highly positive market sentiment: When confidence extends beyond Bitcoin and investors seek opportunities in new projects, it’s a sign of altseason.

Specific events: Launches of major altcoin projects, positive regulatory decisions, or technological breakthroughs can trigger altseason.

Bitcoin halving or regulatory developments: These events often generate positive market sentiment, creating favorable conditions for altseason to begin.

Trading Strategies for Altcoins During Altseason

To maximize profits during altseason, traders should employ some basic strategies.

First, thorough research is essential. Each altcoin should be analyzed for the development team, underlying technology, practical applications, and comparison with similar projects. Avoid getting caught up in hype without understanding what you’re buying.

Second, diversify your portfolio. Instead of concentrating all funds in one or two altcoins, spread investments across multiple promising projects. This reduces risk if one project underperforms.

Third, set realistic expectations. While altseason offers high profit potential, it also involves significant volatility. Prepare for sudden price swings and avoid expecting quick riches.

Finally, use risk management tools like stop-loss orders to protect your holdings. Setting a price level at which you accept losses helps prevent devastating losses during sharp declines.

Managing Risks When Investing in Altcoins

Altseason presents opportunities but also inherent risks that investors must prepare for.

High volatility: Altcoins tend to be more volatile than Bitcoin, meaning large losses can occur in a short period. Additionally, lower liquidity in some altcoins can lead to significant slippage.

Price bubbles and trading frenzy: During altseason, excessive speculative activity can inflate prices unnaturally, increasing the risk of a bubble burst.

Scams and rug pulls: Always be cautious of scam projects or rug pulls, where developers abandon projects after raising funds. Pump-and-dump schemes also pose threats—sudden sell-offs can cause sharp price drops.

Regulatory risks: Changes in regulations can significantly impact the entire altcoin space. For example, tighter ICO regulations in late 2018 contributed to the end of that altseason.

Regulatory Impact on Altseason

Regulation plays a crucial role in shaping altseason cycles. Changes in policy can either stimulate or dampen altcoin activity.

Strict regulations—such as crackdowns on ICOs or tighter exchange rules—may cool the market and end altseason prematurely. Conversely, clear and positive regulations, or a supportive legal framework, can boost interest in altcoins.

A notable example is the SEC’s approval of Bitcoin spot ETFs in 2024 and subsequent Ethereum ETF approvals. These decisions opened the door for institutional investment and boosted overall market sentiment, facilitating altseason development.

Conclusion

Altseason is a cyclical phenomenon in the cryptocurrency market, characterized by capital shifting from Bitcoin to altcoins. By understanding key indicators, applying advanced trading skills, and managing risks effectively, investors can capitalize on the opportunities altseason offers. However, it’s important to remember that altseason also involves high volatility—staying informed about market trends, technological developments, and regulatory changes is essential for making informed investment decisions.