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- Analysts say these key metric hints an altcoin season is at hand
- DeFi and NFT projects create new record highs
- The London hard fork ushers welcome changes on the Ethereum ecosystem
Has the altcoins season started? A string of new all-time highs from altcoins and a drop in the Bitcoin dominance metric has many analysts convinced that the.
Key metrics suggest that the altcoins season has just started. Bitcoin, which lost 50% of its values after the May 19 crash, has made a remarkable 65% recovery and has swung from sub-$29,500 on July 20 to a swing high of $48,200 on Aug. 14. In less than a month, it has managed this feat and has brought a fresh lease of life to the cryptocurrency market. The bullish sentiments are prevailing all around, and traders who were dreading the prospect of another prolonged bear market are now much relieved.
At present, BTC is stagnant at a $46,000 price level, and this phase of sideways trading allows altcoins to step forward. The chart reveals that the total market capitalization of the altcoin market has risen 80% since July 20. However, the BTC domination has fallen 10% since July 30.
TradingView reveals that the dominance rate of Bitcoin has been on the rise in recent weeks. However, the trend was not long-lasting and bubbled out by July 30 as several altcoin projects rallied due to a marketwide oversold bounce, new partnerships and protocol updates.
DeFi and NFT projects surge to record highs
The past four weeks saw non fungible tokens (NFTs) and decentralized finance (DeFi) leading altcoin gainers. The three largest gainers over the past month include Axie Infinity Shards (AXS), Solana (SOL) and Terra (LUNA), which all saw their prices break out to new record highs on Aug. 17.
As can be gauged from the chart above, AXS price surged nearly 400%, while LUNA and SOL increased by 340% and 187%, respectively. Looking carefully, one can gauge that Solana and Terra began to see increased interest several days after implementing the London hard fork on the Ethereum network.
The London hard fork leads to several welcome changes on the Ethereum ecosystem.
The London hard fork leads to several welcome changes on the Ethereum ecosystem. It includes a token burning mechanism that has the potential to make Ether deflationary. However, sadly the upgrade did little to solve the problem of high transaction costs. This left the door open for competing for layer-one solutions like Solana and Terra to gain market share.
The surging Altcoins has led many analysts to the birth of the new altcoin season. According to “The Moon,” a pseudonymous Twitter analyst, altcoin seasons follow a major run-up in BTC price, especially when the price stalls or pulls back.
The increasing number of altcoins notching new all-time highs over the past two weeks is evidence of the start of an alt season. Double-digit daily gains by projects like Audius and meme coins like Dogecoin (DOGE) and Shiba Inu (SHIB) are making headlines. Social media like Twitter is ablaze with talks about the hottest altcoins to watch.
However, the Altcoin Season Index is at its lowest point in two years, highlighted in the tweet below. Experts are free to interpret what this means in the long run. However, one bullish take is that the altcoin rally seen in the past two weeks is just a prelude to the real altcoin season, which has yet to begin.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
