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What is Altseason? – Learn more about the altcoin season and the prospects for the next one

What is Altseason? This term gained popularity between 2017 and 2018, after the Bitcoin bubble burst. The fall in the BTC price, which in the previous year had reached a record high of $19,000 USD per unit, pushed investors around the world to look for investment alternatives in other cryptocurrencies.

As a result, BTC’s main competitors gained an unprecedented position in the crypto market. The impact of the burst was such that in February 2017 Bitcoin alone represented around 95% of the market, but in January 2018 this figure reached a minimum of 38%!

In this context, some altcoins grew more than 400% in a short span of time. Some of today’s major cryptos, such as Ethereum, Dash, Monero, and XRP, consolidated in the market during this time. This period was also known as the altcoin spring.

In this article, the Cripto InterCambio blog will further explain what altseason is and what the prospects look like for the next one.

What is Altseason: History

The Rise of Bitcoin

2017 was a remarkable year for the crypto world. During that year, Bitcoin’s price rose about 19 times. At the beginning of January, the price of a coin was around $1,000 USD. Eleven months later, and after a full year of upward trends, BTC was valued at almost $19,000 USD, reaching its highest historical value.

Due to this rapid growth, Bitcoin ceased to be a topic only for fans and gained greater acceptance among a wider audience. It was the snowball effect. The more people invested, the more the BTC price grew. Large and small investors had their first contact with the crypto world at that time.

The reasons for the rise and fall of Bitcoin in 2017 are multifactorial and will be a topic for expert discussion for years. Growth is strongly correlated with halving, when fewer Bitcoins are generated per validated block. The reason for the bubble burst is still not clear, but some suggest there was market manipulation by large investors.

What are Altcoins?

Many people heard about cryptocurrencies for the first time in 2017. However, it is worth remembering that Bitcoin was created in 2009.

Even since the time BTC was completing its first transactions until its rise in 2017, a series of cryptocurrency projects have emerged to compete with Bitcoin: the so-called altcoins.

In general, such cryptocurrencies attempt to improve aspects of the original Bitcoin or bring new blockchain technology concepts. Faster transactions, greater anonymity, smart contracts, lower energy expenditure… there is a bit of everything.

The fact is that most of them were virtually unknown until the Bitcoin bubble in 2017. BTC had about 90% market dominance, while hundreds of other cryptocurrencies had the remaining 10%.

 Altseason

The growth of Bitcoin and the massive entry of capital into the cryptocurrency market created interest in other cryptocurrencies. Hundreds of thousands of investors realized that one of those extremely cheap currencies could be the new Bitcoin, whose price could grow rapidly in the short and medium-term.

The demand for altcoins grew enormously when the Bitcoin bubble burst, then the altseason began. Almost all altcoins had significant increases in January 2018. Here are some examples:

●          Ethereum

Price in January 2017: $8.30 USD

Price in January 2018: $1,360 USD

●          Dash

Price in January 2017: $10 USD

Price in January 2018: $1,439 USD

●          Monero

Price in January 2017: $13.69 USD

Price in January 2018: $472 USD

After that peak, altcoins prices never returned to such highs. Most of them saw their price fall in the following years, while Bitcoin again gained strength against altcoins. Currently, Bitcoin has about 68% of the market, and its market capitalization value is almost 9 times higher than the second-largest cryptocurrency: Ethereum.

What is Altseason: When will the next Altseason be?

It is difficult to say precisely when the next altseason will be. There are multiple factors that lead up to it in the crypto world. But some factors can serve as indicators, and 2020 looks promising. Let’s take a look:

Heated market

The cryptocurrency market is quite volatile, and goes through long low periods, followed by shorter high periods. It is common for cryptocurrencies to be valued as a whole, and not just individually – which means more or less confidence at the moment.

2020 has been surprising. In January alone, Bitcoin appreciated 30%. Other currencies have grown even more, such as Dash and Cardano.

Market Dominance

The most relevant factor pointed out by cryptocurrency analysts is market dominance. This means that investors are willing to invest more in other cryptocurrencies when Bitcoin loses its ground.

Here, the FOMO (Fear of Missing Out) effect becomes relevant. Just like the snowball metaphor: as the little ball begins to roll everyone wants to join in (getting the most benefit from it) before it hits the wall.

Leading up to January, Bitcoin dominance remained above 65%. This means that investors are not willing to withdraw from BTC and take general risks, at least not yet.

But 2020 has just begun! Hopefully, there will be changes in the next months! Maybe next altcoin season is knocking on the door.

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