Why Altcoin Season Is Delayed? Insights from CryptoQuant CEO
The altcoin season has been delayed, and prominent crypto analyst Ki Young Ju explains why. Although he remains bullish on altcoins, he point It turns out that only a few businesses are able to attract new capital. The current Bitcoin rally is driven primarily by institutional demand and spot ETFs, which has not resulted in a shift of capital toward altcoins as in previous cycles. Meanwhile, the Altcoin Seasonal Index is at 41, which means the rally is not ready to take off yet.
Let’s see what dampened the bullish momentum.
Why altcoins are struggling?
The main reason for the delay is Bitcoin. Currently, Bitcoin’s surge is driven by institutional investors and growing interest in Bitcoin ETFs. Unlike regular cryptocurrency traders, these institutional players do not convert their assets from Bitcoin to altcoins.
They mainly stick to Bitcoin, and since they trade off exchanges, there is less chance of typical fund flows from Bitcoin to altcoins. This shift in capital flows has hindered altcoins from making significant breakouts. Considering the current situation, the analyst said that he is bullish on altcoins, but not all altcoins will see a breakout and few will see a new ATH break that may plummet.
demand for new capital
In order for altcoins to hit all-time highs, they will need massive new capital flows into cryptocurrency exchanges. However, with altcoin market capitalization still below previous records, it’s clear that there is a lack of new liquidity for daily traders. Essentially, altcoins are waiting for more retail investors to come on board, but that hasn’t happened yet.
If Bitcoin’s bull run continues to be strong and retail investors start to worry that they are missing out, we may see more action from cryptocurrency exchanges. This could spark an altcoin season, but it will take some FOMO (fear of missing out) in retail to get this going. However, Bitcoin’s current growth is mainly driven by institutional funds rather than retail investors.
Altcoins need their strategies
To take off, altcoins can no longer rely solely on Bitcoin’s momentum. They need to create a buzz and find ways to attract new capital independent of Bitcoin. Whether it’s innovative technology, a strong community or new use cases, altcoins must carve out their own space if they want to thrive.
In short, altcoin season is not over yet, but it has been delayed. Altcoins will need new capital and more retail activity to catch up, they can’t just wait for Bitcoin’s momentum to boost them.
