Altseason in 2024: When money moves from Bitcoin to altcoins

December 2024 is a period of intense activity in the crypto market. Bitcoin is approaching the $100,000 mark, and the entire market is buzzing with speculation about a crypto-friendly political course. But while everyone is watching the king of cryptocurrencies, something more interesting is happening: money is moving into altcoins. This phenomenon is known as altseason, and understanding its mechanics is critical for every trader.

What has really changed in altseason?

Previously, altseason was simply a rotation: Bitcoin was rising, traders took profits, and they poured money into cheaper altcoins. Today, it’s more complex.

Kiy Yang Ju, CEO of CryptoQuant, points to a fundamental shift: Historically, capital moved from Bitcoin to altcoins, but now the driver of altseason is the increase in trading volumes of altcoin/stablecoin pairs.

In plain language: before, people had to sell Bitcoin first to buy altcoins. Now they just transfer stablecoins (USDT, USDC) directly into altcoins. This means more investments, they come faster, and the market is more liquid.

Add to this institutional capital flowing into crypto via new Bitcoin ETFs, and you get a new type of altseason — not speculative hype, but real market growth with genuine money.

How to recognize that altseason has started: Four signals

Identifying altseason is an art of reading market signals. Here are four key indicators:

1. Bitcoin dominance decline

Bitcoin dominance is the total market capitalization of Bitcoin divided by the total crypto market cap. When this indicator drops below 50%, it has historically signaled the start of altseason. Falling below 40% is a direct signal of a strong altseason.

Currently, dominance is around 60%. Not an extreme, but the trend is downward.

2. ETH/BTC ratio

Ethereum often serves as a barometer of the health of the altcoin market. When Ethereum’s price rises relative to Bitcoin (meaning ETH/BTC ratio goes up), it indicates that altcoins are outperforming the king. Rising ETH/BTC often precedes broader altseason.

3. Altseason index

Blockchain Center has calculated a simple index: how the 50 largest altcoins perform against Bitcoin. When the index exceeds 75, it signals altseason.

As of December 2024, the index has reached 78 — the market is already in the altseason zone.

4. Growth in altcoin trading volumes

Volumes of altcoin/stablecoin pairs are increasing, meaning more money is truly entering altcoins rather than just speculation. Especially notable are surges in specific sectors — for example, meme coins (DOGE, SHIB, PEPE) grew by more than 40%, and AI tokens like Render and NEAR Protocol also showed strong dynamics.

History of altseasons: Three major waves

End of 2017 — early 2018: ICO boom

Bitcoin dominance fell from 87% to 32%. New tokens sold via ICO (initial coin offerings) captured all the attention. Ethereum, Ripple, Litecoin — all grew simultaneously. Total market cap increased from $30 billion to over $600 billion.

But it ended with a crash: regulatory pressure and failed projects collapsed the 2018 altseason.

2021: DeFi and NFT revolution

Bitcoin dominance dropped from 70% to 38%. But this was a different kind of altseason. People weren’t just buying cheap altcoins for speculation — they jumped into DeFi (decentralized finance), NFT art, digital collectibles.

Altcoins related to these technologies made 10x, 100x profits. The market reached over $3 trillion in capitalization. It was a real transformation, not just gambling.

2024: Market maturation

The fourth Bitcoin halving in April, approval of Bitcoin and Ethereum ETFs, new regulatory environment — all created favorable conditions. But unlike previous altseasons, this one unfolded differently.

Instead of one “hero” (like ICOs or NFTs), money is distributed across several sectors:

• AI coins: Render, Akash Network — grew by over 1,000%
• GameFi: ImmutableX, Ronin
• Meme coins (which sounded like a joke): SnailBrook and others integrated AI and showed real utility
• Solana ecosystem: tokens soared by 945%, dispelling the myth of a “dead blockchain”

Four phases of altseason: How money moves

Almost every altseason unfolds according to a scenario:

Phase 1: Bitcoin dominance Capital is stuck in Bitcoin as a stable asset. Bitcoin dominance index is high. BTC trading volumes lead. Altcoins are calm.

Phase 2: Ethereum awakens People realize that DeFi and Layer-2 solutions on Ethereum generate income. Money flows into Ethereum. ETH/BTC rate rises. DeFi activity flourishes.

Phase 3: Large-cap altcoins rise Solana, Cardano, Polygon — all show double-digit gains. Risk-averse investors dare to enter almost-Bitcoin projects.

Phase 4: Altseason ignites Small-cap projects and speculative tokens all rise on the wave. Bitcoin dominance drops below 40%. Some coins make 5x, 10x in months.

Institutional money has changed the game

Previously, altseason was retail traders’ hype, jumping into Ponzi schemes and bagholding. But in 2024, a different scenario is underway.

Approval of Bitcoin ETFs brought over 70 new funds. BlackRock, Fidelity, and others are already in crypto. They don’t play with meme coins — they see Ethereum, Solana, leading DeFi protocols as real assets.

This means the money is more stable. It doesn’t mean less volatility — no, altcoins are still wild. But it means that behind altseason are real fundamentals, not just hype.

Trading during altseason: Practical rules

Don’t fall into speculation

The renewed temptation during altseason is to pour all your money into the most volatile coins amid hype. Risk manager Doctor Profit says directly: “Discipline is key — profits can quickly turn into losses without it.”

Gradually take profits. If a position was +200%, take half. Don’t wait for an 80% drop to tell you it’s over.

Diversify — don’t put all eggs in one basket

Don’t buy only meme coins or only AI tokens. Spread your portfolio across several prospects: large-cap altcoins, DeFi, new projects, speculative plays.

This reduces the risk of one position collapsing the entire portfolio.

Do your research before buying

Read the whitepaper. Check the team. Look at real activity on the blockchain (using tools like Glassnode, Nansen). Don’t buy just because everyone talks about it.

Risk management — not optional

Stop-loss orders. Position sizing. Don’t trade with maximum leverage. The more leverage — the faster you can lose all your money.

What can break the altseason?

Regulatory blow

If the US or EU impose strict restrictions on crypto trading — money will exit the market. This has been seen before. The positive side: the current regulatory environment is quite lenient, especially after US elections.

Collapse of a leader

If Ethereum suddenly drops 50% — it will break the entire altseason. Ethereum often acts as a locomotive for broader movement. If the king of altcoins falls, the rest will go down too.

Sudden institutional exit

If large funds start selling en masse — it could trigger a cascade decline. Although less likely than before, because institutions are investing long-term.

Margin calls

When traders use maximum leverage and the market moves 20% against them — chaos ensues. This automatically forces positions to close, pushing prices even lower. During altseason, this is especially dangerous.

Commercial and meme coins: A new wave

An interesting development in 2024: meme coins have begun to evolve beyond jokes. Some are integrating AI, others have built real communities.

Meme coins on Solana (instead of traditional Ethereum) started gaining popularity. The Solana ecosystem overall showed a growth of 945%, changing the narrative about a “dead blockchain.”

This doesn’t mean all meme coins are good investments. Most will lose money. But it means the market is evolving, and altseason now covers more diverse assets than before.

Looking ahead: Q4 2024 and beyond

Key factors that will drive altseason:

1. Institutional adoption — 70+ Bitcoin ETFs already launched, increasing confidence
2. Regulatory clarity — US seems to be moving toward crypto-friendly policies
3. New all-time market caps — The crypto market has already broken through old highs of 2021 ($3.2 trillion)
4. Bitcoin approaching $100K — a psychological milestone that could attract new players
5. Sector diversification — unlike one “hero,” money is spreading across AI, GameFi, DeFi, meme coins

All these point to the fact that altseason will not be a short speculative spike. It could be much bigger — a period when altcoins grow into a true asset class.

Conclusion: How to trade altseason wisely

Altseason is a real opportunity, but not an automatic golden ticket. Success depends on discipline, research, and risk management.

Monitor the four key signals: Bitcoin dominance, ETH/BTC ratio, altseason index, and trading volumes. Diversify your portfolio. Take profits gradually. Don’t risk more than you can afford to lose.

Before any investment, do your own research (DYOR). Understand the project, its fundamentals, and risks. Don’t follow hype on social media — follow the data.

The crypto market is maturing. Altseason is already here. The question is — will you participate wisely or jump into speculation?