According to Ki Young Ju, CEO of CryptoQuant, the next altcoin season (altseason) will not be determined by a capital rotation from Bitcoin to altcoins, but by an increase in the trading volume of altcoins compared to stablecoins. This shift marks a new dynamic in the crypto market.
Stablecoin liquidity as a new driver
Traditionally, an altseason was characterized by a capital rotation from Bitcoin to altcoins, with investors taking profits on Bitcoin and reinvesting them in altcoins. According to Ki Young Ju, this model is now outdated. Instead, we are seeing increasing trading activity of altcoins against stablecoin pairs such as USDT and fiat currency, indicating “real market growth” rather than a reallocation of capital.
This pattern is supported by the low trading volumes of altcoins against Bitcoin in recent weeks, even as coins such as Ethereum (ETH), XRP and Solana (SOL) are close to their all-time highs. At the same time, the trading volume of altcoins is increasing relative to stablecoins, indicating a sustainable evolution of the market structure.
Institutional capital flows and stablecoins
An important factor in this shift is the changing nature of capital flows. While previous bull markets were primarily retail-driven, the current cycle is dominated by institutional capital flows into Bitcoin ETFs. This explains why stablecoin liquidity now plays a more important role in the success of altcoins.
However, the market capitalization of all cryptocurrencies, excluding Bitcoin, remains below their all-time high. According to Ki Young Ju, a new peak in the altcoin market will require significant inflows of new capital.
Altseason index points to impending outbreak
The Altcoin Season Index, developed by Blockchain Center, suggests that an altseason is close. If 75% of the top 50 altcoins outperform Bitcoin over a 90-day period, it is considered an altseason. The index currently stands at 73%, which means that the 75% limit is within reach.
With top altcoins challenging new highs and the growing role of stablecoin liquidity, the market appears primed for a potential altcoin rally. Market participants are advised to keep a close eye on the Bitcoin dominance index and developments surrounding stablecoin liquidity.
Claim €10 free and have a chance to win €200 in Sui (SUI)!
Grab this unique opportunity with Newsbit and Bitvavo! Create an account now via the button below, deposit €10 and immediately receive €10 free. But that’s not all: by trading at least €200 between December 2 and 8, you automatically have a chance to win as much as €200 in Sui (SUI). This promotion is valid for both new and existing customers!
Claim your €10 free, have a chance to win €200 in Sui (SUI)
Don’t miss this opportunity to immediately benefit from the growing popularity of Crypto!
Source: https://newsbit.nl/altseason-dichtbij-niet-langer-gedreven-door-bitcoin-maar-door-stablecoin-liquiditeit/
