The CoinMarketCap Altcoin Season Index has fallen below 40, indicating that altcoins are continuing to lag behind Bitcoin. What does this mean for investors?
The Altcoin Season Index is an essential tool for assessing market trends between altcoins and Bitcoin (BTC), analyzing the performance of the top 100 cryptocurrencies over a 90-day period. A reading of 75% or higher signifies that altcoins are outperforming Bitcoin, categorizing the market as being in altcoin season.
In December 2024, the index peaked at 64, suggesting the onset of altcoin season. However, since January, the index has hovered just above 40 and now shows signs of dropping further, currently standing at 36 as of February 17, indicating Bitcoin is driving the market.
Despite ongoing market volatility, Bitcoin has shown strong resilience, remaining above $96,000. The overall market trajectory may hinge on Bitcoin’s next moves. However, some analysts express caution regarding the future outlook.
One analyst highlights the Inter-exchange Flow Pulse (IFP) indicator, which is currently signaling a bearish trend. This indicator monitors Bitcoin’s movement between derivatives and spot markets, where increased flows into derivatives typically suggest bullish sentiment. The current negative signal indicates that Bitcoin may encounter additional resistance before any breakout.
Meanwhile, altcoins are experiencing challenges, possibly influenced by the influx of new product launches. A saturated market can dilute liquidity, affecting overall performance.
Recent data reveals that over 600,000 new tokens were introduced in January 2025, indicating an active shift as investors navigate between various tokens, negatively impacting altcoin performance.
Among the top-performing altcoins recently are Hyperliquid (HYPE) and Ripple (XRP), which have surged by 735% and 143% respectively over the past 90 days. Conversely, many AI-related tokens have faced significant declines, including RENDER (RNDR), Artificial Superintelligence Alliance (FET), and Near Protocol (NEAR), which have all dropped over 40% in the same timeframe.
Historically, altcoin seasons tend to follow Bitcoin’s periods of consolidation or decline. Future growth for altcoins will likely be influenced by broader economic trends, regulatory changes, and overall market dynamics.
