Altseason in Crypto: Understanding the Cycle of Altcoin Dominance

Altseason is a period in the cryptocurrency market where altcoins outperform Bitcoin, often driven by capital rotation from Bitcoin to altcoins seeking higher returns. Notable examples include the 2017 ICO boom and the 2021 DeFi and NFT explosion. Altseasons highlight a shift in market dominance and can be driven by new use cases, innovation, and speculation. Knowing how to identify Altseason can make a significant difference in investment outcomes.

The cryptocurrency market has been experiencing a notable shift in recent weeks, with altcoins significantly outperforming Bitcoin. This phenomenon, known as altseason, is a period where alternative cryptocurrencies (altcoins) attract capital from Bitcoin holders seeking higher returns. Altseason is often driven by new use cases, innovation, and market speculation, as seen in previous notable instances such as the 2017 Initial Coin Offering (ICO) boom and the 2021 DeFi and NFT explosion.

According to CoinMarketCap’s Altcoin Season Index, which measures the relative performance of altcoins compared to Bitcoin, the index has been trending upward since April, reaching a score of 53 out of 100 by July 2025 [2]. This increase suggests that altcoins are gaining traction and could be entering a period of significant growth. The index's current level, while not as high as the peak in December 2024, indicates a growing interest in alternative crypto assets.

The Federal Reserve's stance on interest rates is a crucial factor in the current altseason. Lower inflation and potential rate cuts from the Fed could drive liquidity back into risk assets like cryptocurrencies, fueling altcoin rallies. Additionally, improving market liquidity and growing stablecoin issuance provide the necessary fuel for altcoins to run [2].

Notable altcoins that have seen significant gains include Solana, which has increased by more than 16% over the last week, and Hyperliquid, which has notched gains above 14%. However, the most striking example is Cronos (CRO), the native token of the Crypto.com trading platform, which has seen a historic rally, gaining more than 120% in the last seven days [2].

The Trump Media and Crypto.com partnership has been a significant driver of CRO's recent surge. The companies announced a plan to integrate Crypto.com’s wallet infrastructure on Truth Social and adopt CRO as a utility token for rewards and subscriptions. This deal, which includes a $6.4 billion treasury focused on CRO accumulation, has created a strong bullish momentum for the token [2].

From a technical perspective, CRO’s Relative Strength Index (RSI) is at 89, indicating that the token is in severely overbought territory. However, the Average Directional Index (ADX) at 39 confirms a powerful trend in place, suggesting that the token's recent gains are backed by strong momentum. Support for CRO sits at $0.18, while resistance is at $0.40 [2].

Bitcoin, the king of cryptocurrencies, appears to be consolidating and struggling to resume its bullish trend. Its ADX at 17 indicates choppy, directionless trading, creating an environment for altcoin rotation. The 50-day and 200-day EMAs show BTC trading between these key averages, with the 50-day EMA providing resistance around $114,000 while the 200-day sits lower near the $104,000 price zone [2].

Ethereum (ETH) also shows signs of bullish momentum. Its ADX at 36 confirms a strong trending environment, with the 50-day EMA providing solid support in the $4,000 zone and the 200-day EMA acting as a foundation near $3,000. The RSI at 56 indicates healthy momentum without being overbought, suggesting accumulation rather than distribution [2].

In conclusion, the current altseason in the cryptocurrency market presents opportunities for investors seeking higher returns. However, it is essential to approach these investments with caution and a thorough understanding of the risks involved. The market's volatility and the potential for overvaluation in certain altcoins should be considered before making any investment decisions.

References:
[1] Reuters. (2025, August 29). Eric Trump Sees Bitcoin Hitting $1 Million, Praises China's Cryptocurrency Role. Retrieved from https://www.reuters.com/world/asia-pacific/eric-trump-sees-bitcoin-hitting-1-million-praises-china-cryptocurrency-role-2025-08-29/
[2] Yahoo Finance. (2025, July 2). Altcoin Season: Coins Soaring as Bitcoin Pauses. Retrieved from https://finance.yahoo.com/news/altcoin-season-coins-soaring-bitcoin-202118188.html