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DeFiGaming & MetaverseInfrastructureMarketsNFTs
To Alt or Not to Alt, That’s the Question
Nicolai Søndergaard
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Key Takeaways
9 min read
  • Newer tokens often outperform: Historically, newer tokens tied to emerging trends, like DeFi in 2020 or NFTs in late 2021, attract more interest and often outperform established tokens during altcoin seasons.
  • Macroeconomic factors matter: Federal Reserve policies, especially changes in interest rates, influence market liquidity. Recent rate cuts could create a favorable environment for altcoins as investors seek higher-risk opportunities.
  • Rotation into altcoins: As Bitcoin stabilizes after exploring new highs, capital may begin to shift into altcoins, presenting potential opportunities for investors looking to diversify into riskier assets.

Introduction

As Bitcoin continues to test new highs and its dominance hovers around 60% a level not seen consistently since March 2021 many investors are asking: Is another altcoin season on the horizon? Altcoin season traditionally refers to a phase in the crypto market where alternative coins outperform Bitcoin for an extended period. This doesn’t mean isolated spikes or meme coin frenzies, but rather a broad shift in capital flows favoring altcoins across categories.

source: TradingView

Given Bitcoin’s strong position, the question remains: could the coming months bring a general shift toward altcoins, or are...