YEREVAN (CoinChapter.com) — Crypto analyst Willy Woo says altcoin seasons will likely continue, but with lower returns as the crypto market matures. He notes that these cycles have become less intense since the major boom in 2017. That year, initial coin offerings (ICOs) fueled the altcoin market, letting projects raise funds through token sales. Woo explains that while altcoin seasons are here to stay, the high returns of past cycles may be a thing of the past.
Woo shared his analysis on X on October 26. He pointed out that each altcoin season since the 2017 peak has been less impactful. This trend appears set to persist.
Higher Risk Assets Attract Investors as Bitcoin Dominance Rises
Despite diminishing intensity, altcoin seasons are still expected to occur as investors shift towards riskier assets in search of higher returns. Investors often begin rotating capital into altcoins when Bitcoin reaches price peaks. They seek gains in smaller market cap tokens. Bitcoin dominance in the market currently stands at 59.31%, approaching the 60% mark. Many analysts consider this level significant, as it historically triggers capital flow from Bitcoin to altcoins.
Bitcoin dominance nearing 60% suggests a potential rotation into altcoins. This is especially the case for for mid- and low-cap cryptocurrencies. According to Woo, this pattern of capital moving up the risk ladder will likely continue, even though future altcoin seasons may yield smaller gains.
TradingView data shows Bitcoin dominance at 59.31%. This suggests that an altcoin influx may follow if the dominance level reaches or surpasses the 60% threshold.
Bitcoin dominance is 59.31% at the time of publication. Source: TradingViewMemecoins Lead Current Altcoin Cycle, Analyst Observes
Willy Woo noted that the current altcoin season appears focused on memecoins. These are typically created as humorous or novelty tokens. Woo commented on this trend as a reflection of the market’s lighter side, describing it as a “piss-take on the crypto space.” Woo’s observations align with market trends but differ from perspectives like that of Mati Greenspan, founder of Quantum Economics, who anticipates a Bitcoin-centric bull run driven by Bitcoin and its layer-2 developments.
Woo’s view on memecoins suggests that this cycle lacks the technological drive seen in past altcoin seasons. He advises caution in holding altcoins long-term, remarking,
“Don’t ever hodl them unless you’re so knowledgeable that you’re an effective insider because alts are an insiders game.”
Woo’s remarks highlight the high-risk nature of speculative trading in altcoins.
Altcoin Market Cap Includes Only Surviving Tokens, Analyst Explains
Woo explained that the altcoin market cap only reflects successful projects, while tokens that have lost value or ceased to exist do not contribute to the calculation. He illustrated this by comparing the altcoin market cap to a “cricket bat that has had 10 new handles and 10 new blades,” signifying a value built solely from surviving tokens.
Some analysts expect a new altcoin season if Bitcoin surpasses its previous all-time high of $73,679, though others, like those at Hashkey Capital, suggest that an altcoin season may be more probable if Bitcoin reaches $80,000.
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