Compass Investments

Will Ethereum’s surge herald an upcoming altcoin season?

Over the past seven days, Ethereum has risen nearly 31% to around $2,495, but neither CoinMarketCap nor BlockchainCenter has yet declared the start of alt season.

Both indices require that at least 75% of the leading coins outperform Bitcoin in terms of returns over a 90-day period, and BlockchainCenters current figure stands at 43.

Arthur Hayes expects ETH to lead the recovery and push this dominance metric up to 40% .

Over the past seven days, Ethereums performance has improved: its price has risen by nearly 31% and now stands at approximately $2,495.

However, despite this weekly growth, the two most authoritative altseason indicators are not yet rushing to declare its arrival. Traders, in turn, have to weigh ETHs rapid growth against indicators that remain in neutral territory.

ETH is trading around $2,494.68, up 2.59% for the day and 31.01% for the week. Bitcoin, currently trading at around $78,411, has gained 23.25% over the past week.

XRP and Zcash (ZEC) are among the few cryptocurrencies that have outperformed ETH over the past seven days. During the same period, XRP rose by approximately 49% , while ZEC rose by approximately 64% .

Nevertheless, Bitcoin continues to dominate the market by total market capitalization, accounting for more than 59% of the market. ETHs share is about 11.4% . Thus, funds have clearly not flowed from BTC into other assets. Overall market sentiment is on the edge: CoinMarketCaps Fear and Greed index stands at 80 out of 100.

There are two indices that define this term, so often used by traders. Altseason, which has long remained elusive, is assessed based on specific criteria from CoinMarketCap and BlockchainCenter. Both have indices that help determine whether this season has arrived or not.

According to CoinMarketCap, alt season begins only when at least 75% of the top 100 coins outperform Bitcoin over a 90-day rolling period. When 25% or fewer coins are outperforming Bitcoin, the site refers to this period as Bitcoin season.

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BlockchainCenter applies a similar rule to the top 50 coins. Thus, if at least 75% of the top 50 coins outperform Bitcoin over a 90-day period, an ‘alt season’ begins. At the time of this review, the figure stood at 43, which is below the alt season threshold.

Based on its own calculations, BlockchainCenter noted that more than 332 days have passed since the last alt season. Both companies exclude stablecoins, such as Tether, and asset-backed wrapped tokens, such as WBTC and stETH, from their calculations.

On August 24, Glassnode posted on X that the altcoin market had entered a phase of optimism, reporting that funding rates for 85% of altcoins had risen above the averagea figure the company described as the highest reading for this indicator since Bitcoin was trading at all-time highs. During altcoin season, such conditions can persist for several weeks, Glassnode added.

In an interview with Laura Shin, BitMEX co-founder Arthur Hayes stated that Ethereum is currently the second-largest holding in his portfolio after Bitcoin, noting that ETHs failure to reclaim its 2021 high leaves room for growth and that the risk of this coin falling to zero is much lower than that of tokens with smaller market caps. He noted that a decisive break above the $3,000 mark could push the price above $5,000.

On the Altcoin Daily podcast, Hayes went even further, predicting that ETH will outperform any other large-cap asset during this liquidity-driven recovery, and could contribute to a decline in Bitcoins dominance to around 40% .

Recent history explains this hesitation. In June, Cryptopolitan reported that altcoin selling volume had reached record highs, with the seasonality index at 49, and on June 30that more than 84% of altcoins were trading below their 200-day moving average, marking the longest such period since the 2022 bear market.”,”detected_source_language”:”RU