Why ALT Season Has Not Happened

Summary

In this video, the speaker explains why an alt season hasn't materialized in the current crypto market cycle. Despite the hype around altcoins, Bitcoin's dominance has remained strong due to factors like low retail interest, social sentiment, and ongoing quantitative tightening (QT). The speaker compares this cycle to the 2019 market, where Bitcoin surged while altcoins lagged behind. The video suggests that Bitcoin will continue to lead, with altcoins likely underperforming until social interest and market conditions shift. Altcoins could only gain traction if QT ends and retail interest returns, but that remains uncertain.

Takeaways

• 😀 Alt season has not happened because altcoins have been consistently losing value relative to Bitcoin since 2021.
• 😀 Altcoin dominance against Bitcoin is at a low of 0.36, and a further drop to 0.25 is expected before any potential alt season.
• 😀 Retail interest in altcoins has been weak, and this lack of social interest contributes to the failure of alt season.
• 😀 Despite Bitcoin's price rising, altcoins have been underperforming against Bitcoin, similar to the 2019 market cycle.
• 😀 Social interest, measured by metrics like YouTube views and Twitter followers, heavily influences altcoin market behavior.
• 😀 Bitcoin dominance has been increasing because of weak altcoin performance and a lack of retail participation.
• 😀 The current cycle closely mirrors the 2019 bull market, where Bitcoin went up significantly but altcoins struggled.
• 😀 Quantitative tightening (QT) is a major factor preventing alt season, and its impact has been felt for an extended period, unlike previous cycles.
• 😀 The Bitcoin market has been absorbing liquidity from altcoins, with Bitcoin staying strong while altcoin prices drop.
• 😀 Bitcoin dominance is expected to rise until at least December 2025, with altcoins potentially reaching their lowest value relative to Bitcoin during that time.
• 😀 The four-year cycle is still relevant, but just because quantitative easing (QE) resumes doesn't guarantee an alt season or a smooth transition into the next phase.

Q & A

Why has alt season not occurred in this cycle?

Alt season has not occurred because altcoins have been consistently losing value against Bitcoin since 2021. Bitcoin dominance has been rising, and the altcoin market has struggled to gain traction due to a lack of sufficient liquidity and social interest.

What is the significance of Bitcoin dominance in this cycle?

Bitcoin dominance refers to Bitcoin’s market cap relative to the entire cryptocurrency market. In this cycle, Bitcoin dominance has been increasing because Bitcoin has been outperforming altcoins, and altcoins haven't gained enough momentum to challenge Bitcoin’s market lead.

How does social interest impact altcoins and Bitcoin?

Social interest, measured through metrics like YouTube subscribers, Twitter followers, and online discussions, directly affects the altcoin market. In periods of high social interest, altcoins tend to rally as retail investors get involved. In contrast, during periods of low social interest, altcoins struggle and Bitcoin dominance grows.

What role did quantitative tightening (QT) play in the current cycle?

Quantitative tightening (QT) has played a key role in this cycle by limiting liquidity in the market. When QT occurs, Bitcoin tends to outperform altcoins as the overall market has less liquidity, which means altcoins don't experience significant price movements. This is why we have seen Bitcoin rise without a corresponding alt season.

How does the 2019 cycle compare to the current market cycle?

The 2019 cycle is being compared to the current cycle due to similarities in monetary policy, particularly the impact of quantitative tightening (QT). In both cycles, Bitcoin saw significant price increases without altcoins gaining significant ground. The altcoin market lagged as liquidity was concentrated in Bitcoin.

Why is the end of quantitative tightening in December important for the altcoin market?

The end of quantitative tightening in December could signal a shift in the market. It may provide more liquidity, which could allow altcoins to start recovering. However, this doesn't guarantee an immediate alt season, as Bitcoin may still dominate, and altcoins might take time to gain significant momentum.

What does the analysis of Bitcoin dominance breaking through its bull market support band suggest?

The analysis of Bitcoin dominance breaking through its bull market support band suggests that Bitcoin's dominance will likely continue to rise. The support band is often seen as a key technical indicator, and its break could indicate that Bitcoin will continue to outperform altcoins for the foreseeable future.

What is the significance of Bitcoin’s market behavior around $100K in comparison to 2019?

Just like in 2019, Bitcoin is holding above key levels (around $100K now, and $10K back then) by drawing liquidity from the altcoin market. In 2019, Bitcoin stayed elevated by absorbing liquidity from altcoins, and a similar dynamic is playing out now with Bitcoin hovering around the $100K mark.

Could a rally in altcoins happen after the end of QT in December?

While it is possible that a rally in altcoins could occur once QT ends in December, it is not guaranteed. The end of QT could provide more liquidity for altcoins, but as seen in previous cycles, Bitcoin might continue to dominate, and altcoins could take longer to see significant price increases.

Why might 2026 be a critical year for the crypto market, according to the analysis?

2026 might be critical because it could represent a phase where the market experiences a decline despite possible Bitcoin price increases. Without a major euphoria phase, a more gradual downtrend could emerge, similar to what occurred in 2019. If retail interest doesn't return, Bitcoin might still face challenges in sustaining long-term growth.