The outlook for altcoins is currently quite grim, as most have been on a downward trend since March, while bitcoin's dominance continues to rise, making it less likely for altcoins to experience a resurgence in value. Recently, on June 20, the popular X account 'Altcoin Sherpa' outlined two key conditions that need to be met for an 'Altcoin Season' to kick off.
Altcoin Sherpa, a crypto analyst, has painted a challenging picture for altcoins in the 2024 market, which has been largely dominated by bitcoin (BTC) as well as artificial intelligence (AI) and meme coins. The total market capitalization of all existing crypto assets currently stands at $2.34 trillion, with BTC accounting for 54% of this total. Ethereum, on the other hand, holds a market share of approximately 18.3% this weekend. During the recent market downturn, alternative digital currencies have faced more significant losses compared to BTC.
Altcoin Sherpa, who has a following of 217,000 on X, expressed skepticism about the current state of altcoin charts and emphasized the need for one of two scenarios to trigger a substantial altcoin rally. The first scenario involves a final capitulation, often signaling a last shakeout, while the second scenario entails a prolonged period of consolidation.
The 'Altcoin Season Index' on blockchaincenter.net currently indicates a low probability of an altcoin season materializing anytime soon. The index, which requires a score of 75 for an altcoin season to begin, currently stands at 20 out of 100 as of June 22, 2024.
Despite the current challenges, Altcoin Sherpa remains optimistic about the potential for a significant rally once the altcoin season kicks off. The timing of this rally remains uncertain, but the analyst expects prices to rise substantially later in the year.
As the crypto market evolves, the possibility of an altcoin season depends on a variety of factors, including market conditions and investor sentiment. With bitcoin maintaining its dominance, altcoins face a tough road ahead to attract significant interest.
What are your thoughts on the analyst's prerequisites for an altcoin rally to commence? Feel free to share your opinions in the comments section below.