Altcoin Season: What Is It? A Guide to Using the Altcoin Season Index for Crypto Investments in 2025

I can't tell you how many times I've watched friends completely miss altcoin runs because they were clueless about market cycles. Literally sitting there with money in their accounts while life-changing gains passed them by.

I've been trading crypto since 2013 (god that makes me feel old), blown up a few accounts along the way, and somehow managed to turn my initial $12k into enough to buy my house... and then lose half of it in 2018 because I didn't understand alt cycles. Stupid, right? But that's how we learn.

TL;DR: Altcoin season typically follows Bitcoin rallies when capital rotates into alternative cryptocurrencies. The Altcoin Season Index measures this by tracking when 75% of top alts outperform Bitcoin over 90 days. We'll show you how to use this data to time your altcoin investments strategically.

What Is Altcoin Season? Definition, Characteristics, and History

So what exactly are we talking about here? I've found that even experienced crypto folks sometimes mix up these terms.

Definition and Core Characteristics

Altcoin season - or "altseason" as most of us call it - is basically when all the non-Bitcoin cryptocurrencies start outperforming Bitcoin. The technical definition says it's when 75% of the top 50 cryptos outperform BTC over 90 days, but honestly, you can usually feel it coming before the numbers confirm it.

This whole BTC dominance thing is fascinating to watch. It's basically just measuring Bitcoin's slice of the entire crypto pie, and when that percentage starts dropping - like when it went from 63% to 39% in early 2021 - that's money flowing into alts. You can literally see it happening in real-time.

When BTC dominance is falling, that's when the crazy alt gains start. While Bitcoin might grind up a boring 15-20%, I've watched alts in my portfolio do 5-10x in weeks. Super exciting but also scary AF if you don't have a plan.

History of Notable Altcoin Seasons

Alt seasons over time

The 2017 altcoin season was INSANE. I still remember watching random ICOs pump 50x while I sat mostly in Bitcoin thinking I was being "responsible." Ugh. During this period, many altcoins saw exponential growth, with gains of 10,000% or more not uncommon.

I've spent wayyy too many nights analyzing these cryptocurrency market cycles, and noticed some patterns. First off, these alt seasons almost always kick in right after Bitcoin has a decent rally. Bitcoin pumps, then kinda goes sideways, and boom - alts start going crazy. They usually last like 3-4 months, though that 2021 one felt like forever (not complaining lol). What's funny is watching everyone's attitude shift - suddenly all that "Bitcoin is digital gold" talk gets dropped for "this new L1 will revolutionize finance!" And when my cousin who thought crypto was a scam starts DMing me about some random token he found on TikTok, that's when I know we're deep in alt season.

At CoinMinutes, we've documented every major altcoin season since 2013, tracking which sectors outperform and when. The patterns are surprisingly consistent across cycles.

Altcoin Season Characteristics: A Quick Reference

Altcoin Season Index - A Tool for Measuring Market Cycles

My obsession with tracking alt season is probably unhealthy at this point. I literally check these index readings before I even get out of bed most mornings. Like, phone in face, still under the covers, squinting at charts. My girlfriend walked in on me once at 5:30am frantically checking numbers after a price alert and just shook her head. Coffee comes second, Twitter third - though I've been trying to break that Twitter habit since it just feeds my FOMO.

Definition and How It Works

The Altcoin Season Index is supposedly this objective tool designed to measure whether the market is in Bitcoin season or altcoin season. I say "supposedly" because no indicator is perfect, but this one's pretty useful.

The index uses this scale:

• 0-25: Strong Bitcoin season (few altcoins outperforming Bitcoin)

• 25-50: Moderate Bitcoin season

• 50-75: Moderate altcoin season

• 75-100: Strong altcoin season

Reading and Analyzing the Index Effectively

So how do you actually use these index tools? I bounce between CoinMarketCap and Blockchain Center's versions. Blockchain Center's UI drives me nuts - looks like it was designed in 2010 - but weirdly I trust it more? 

Confirm different signals before acting

The thing nobody tells you is these indicators give false signals ALL THE TIME during choppy markets. I got faked out twice during that weird sideways period last summer. I made a huge mistake in 2022 watching only the absolute numbers and freaking out when it dropped from 75 to 68. Panic-sold some alts, then watched them pump 30% the next week.

Now I always check Bitcoin dominance charts alongside the index. When they both confirm a trend, that's my signal. Oh, and volume! I learned the hard way that without increasing volume, these moves don't stick.

Altcoin Selection Framework

After watching SOL do a casual 10x while I sat on the sidelines (again, still hurts to talk about), I got tired of missing rockets that I'd actually researched but never bought. So I developed what I loosely call my "system" for picking potential winners. My wife laughs every time I say this - she calls it my "crypto hoarding problem" and she's not totally wrong lol.

Classification and Performance Patterns by Sector

Understanding which sectors tend to outperform can improve your allocation strategy. Not all alts move together - there's usually a sequence:

Sector rotation in Altseason

Layer 1 Blockchains & Smart Contract Platforms

These typically lead the initial phase of altcoin season.

For Layer 1 blockchains, I'm keeping tabs on Ethereum alternatives like Solana, Avalanche, and some of the newer players. They typically pump when ETH gas fees make people rage-quit the network... which happens every single altseason like clockwork.

DeFi Tokens

The DeFi sector absolutely explodes during the middle of altseason. I've witnessed this pattern twice now. Lending stuff, DEXes, yield aggregators - they all start going nuts once the L1s finish their initial run. Made a killing on AAVE in 2021 (like 6x in two months) but completely ignored CRV because I thought its tokenomics sucked. My buddy Jake made a fortune on it and won't let me forget it. "Tokenomics this" he texts me randomly with screenshots of his gains. Jerk. (love you Jake if you're reading this)

NFT, Gaming & Metaverse Projects

These sectors typically heat up in the middle-to-late stages of altcoin season. Projects combining blockchain with gaming, digital ownership, and virtual worlds have captured significant market attention in recent cycles.

Meme Coins & Community-Driven Projects

These represent the high-risk, high-reward category that often performs strongest in the later stages of altcoin season. While fundamentally questionable, tokens like Dogecoin and Shiba Inu have delivered staggering returns during peak market euphoria.

Fundamental Analysis and Selection Criteria

Timing is only half the battle - picking the right alts separates the winners from the rekt. After some painful losses (like that "revolutionary" DeFi project in 2019 that turned out to be two guys in Ukraine who disappeared with everyone's money), I've developed what I loosely call my "system." Though some weeks I'm too lazy or excited to follow it properly.

I use what I call the DVTLM framework (Developers, Volume, Team, Liquidity, Market cap) to evaluate potential investments:

Developers & Development Activity
I've become borderline stalkerish about researching teams and their GitHub activity. Got burned badly on a project where the "Stanford PhD" founder turned out to have zero online history before 2018. Red flag I ignored and lost $3K. Now I won't touch anything unless I can verify the leads are real humans with actual backgrounds.

GitHub activity tells you everything. My worst investment ever was in a "revolutionary" DeFi protocol where marketing was constant but the GitHub hadn't been updated in 6 months. Now I check for regular, meaningful commits - not just cosmetic changes to look active. You'd be shocked how many "hot projects" are basically abandoned by developers while marketing keeps pumping.

Volume & Liquidity
Liquidity saved my *ss during the FTX collapse. Had about $15K in a midcap alt that looked liquid enough, but when everyone rushed for exits, I couldn't sell without 30%+ slippage. Traumatic. Now I'm religious about checking daily volume. My position size can't be more than 1% of daily volume or I'm not touching it, no matter how promising it looks.

Team Verification
The crypto space is still filled with anonymous teams, which isn't always bad (hello, Bitcoin), but requires extra scrutiny. I research team members extensively, looking for:

• Previous successful projects

• Verifiable work history

• Active GitHub contributions

• Conference appearances

• Developer community engagement

Liquidity Depth
Beyond basic volume, I check order book depth on major exchanges. I've found that sweet spot around $500M to $5B market cap where projects are legit enough not to get rugged (usually) but still small enough to 5-10x when things heat up.

Market Cap & Growth Potential
Market capitalization is crucial for gauging growth potential. At CoinMinutes, we've found the sweet spot tends to be in the $100M-$3B range for optimal risk/reward during altcoin season.

Integrated Investment Strategy for Altcoin Season

So you've found some promising alts - now comes the part where almost everyone screws up (me included, repeatedly). How much do you buy, when do you get in, and when the h*ll do you sell?

Portfolio Allocation Strategy According to Market Phases

I've blown up portions of my portfolio at least three separate times by ignoring position sizing. "Great project, I'll just throw 20% of my portfolio at it!" = recipe for pain. My buddy Jake and I still laugh about our 2017 strategy, which was basically "buy whatever's pumping on Twitter and sell when we double." Somehow we made money, but only because the market was insanely forgiving.

Shift your allocation by phase

Your cryptocurrency investment strategy needs to adapt as market phases shift. I learned this lesson in blood in early 2022 when I was still in full alt-season mode while the market was clearly transitioning back to Bitcoin. Cost me about 40% of my portfolio value in 8 weeks of stubborn denial.

Bitcoin Season Allocation (Index below 50)

During Bitcoin season, I generally keep about:

• 60-70% Bitcoin (though I've gone as high as 80% when things looked sketchy)

• 20-30% Blue-chip altcoins (Ethereum, Solana, etc.)

• 5-10% Smaller altcoins with strong fundamentals

• 5-10% Stablecoins for buying opportunities

Altcoin Season Allocation (Index above 50)

As the index moves above 50 and confirms the beginning of altcoin season, I get more aggressive:

• 30-40% Bitcoin

• 40-50% Established altcoins with proven use cases

• 10-20% Smaller, higher-potential altcoins

• 5-10% Stablecoins

This portfolio rotation strategy allows you to maintain exposure to the entire market while emphasizing assets likely to outperform during each phase. Well, that's the theory anyway. In practice, I sometimes get too excited and overallocate. We're all human.

Portfolio rebalancing is crucial. During strong altcoin seasons, successful altcoin positions can quickly grow to dominate your portfolio. While this might seem desirable during a rally, it creates dangerous concentration risk. Though I'll admit I sometimes let winners run too long. Cost me BIG in 2021 when I should've taken profits but convinced myself "this time is different."

Timing Exit Points

I learned about exit strategies by NOT having them. In 2021, I watched life-changing paper gains evaporate because I got greedy and couldn't pull the trigger on selling. These days I'm religious about taking profits along the way. I usually cash out like 20% when something hits 2x my entry, another chunk at 3x, and more at 5x if I'm lucky enough to get there. Nothing fancy but it works for me.

My current exit strategy combines multiple triggers:

• Price-Based: Taking profits at predetermined multiples (20% at 2x, 30% at 3x)

• Index-Based: Getting defensive when the Altcoin Season Index peaks and starts declining

• Time-Based: Considering exits after 3+ months of strong performance regardless of other factors

• Sentiment-Based: When mainstream media and random friends start talking about crypto, I get nervous

Comprehensive Risk Management Framework

Position Sizing and Portfolio Protection

These days I'm super strict about position sizing. The moonshot, sketchy stuff gets tiny allocations - like 0.5% to 1% max. Though I gotta admit, sometimes when I'm really excited about something I'll push it to 2-3%. Got carried away with a gaming token last quarter and put in 4% - still underwater on that one. When will I learn?

The Three-Tier Position Sizing Framework

A useful framework divides altcoins into tiers:

Size positions by risk level

• Tier 1 (Established projects): Maximum 5-8% of portfolio per position

  • Examples: ETH, SOL, LINK, AAVE

  • Characteristics: Large market cap, proven use case, strong development team

• Tier 2 (Mid-cap projects): Maximum 2-4% of portfolio per position

  • Examples: Mid-size DeFi protocols, emerging L1s, established NFT projects

  • Characteristics: $500M-$3B market cap, growing adoption, solid fundamentals

• Tier 3 (Small-cap speculative projects): Maximum 0.5-1% of portfolio per position

  • Examples: New protocols, micro-cap gems, early-stage innovations

  • Characteristics: Under $500M market cap, higher risk, potential for explosive growth

Beyond position sizing, diversification across sectors provides important protection. Ensure your altcoin allocations span different use cases and technology types. Don't put all your money in DeFi tokens or all in gaming tokens.

Stop-Loss Adaptations for Crypto Volatility

Stop-loss strategies in the extreme volatility of altcoin markets require adaptation. Traditional tight stops (5-10%) often get triggered by normal market noise. Consider wider stops (20-30%) or using time-based exits if fundamental conditions change. I used to set 15% stop losses but kept getting stopped out during normal volatility. Now I use mental stops at 30% and time-based evaluations.

Counterparty Risk Management

And please, for the love of god, get your coins off exchanges whenever possible. I had a small amount on FTX when it imploded - like $2K, nothing life-changing. But some folks in my Discord group lost everything. The way it collapsed overnight was terrifying. One day everything's fine, next day your money's just... gone. Now I'm paranoid about counterparty risk. Better safe than sorry.

Investment Psychology and Behavioral Finance

The psychological challenges of altcoin season can be more difficult than the technical ones. This part of crypto investing drives me absolutely crazy sometimes:

FOMO management is critical as fear of missing out drives many investors to buy at local tops after significant price appreciation has already occurred. Combat this by establishing entry rules based on value rather than recent performance. I've bought tops more times than I care to admit. Trying to be better about this.

In the guides that CoinMinutes writes, we include a "FOMO Check" section where I rate current market sentiment and highlight areas that might be overheated.

The Future of Altcoin Seasons

The crypto market keeps evolving, and honestly, nobody really knows what's coming next. I have theories, but they're probably as wrong as my 2022 prediction that ETH would flip BTC (yikes, that was embarrassing).

How Markets Are Getting Weird(er)

Altcoin future: Unpredictable forces

Some trends I've noticed:

Institutional money has been fascinating but NOT what I expected. When BlackRock jumped into ETH last year, I was convinced we'd see an immediate moon scenario. Instead? It created this weird dampening effect where everything got... less volatile? Turns out billionaires don't ape in like us retail degens. Who knew?

Regulatory FUD gives me constant anxiety. Every time Gary Gensler opens his mouth, my portfolio swings 15%. I've started keeping bigger stablecoin positions just in case - like a mini-disaster fund for when the SEC decides to randomly nuke some project I'm heavily invested in (happened twice last year).

New token categories emerge with each crypto market cycle. Recent innovations include AI tokens, Real World Asset (RWA) tokens, and increasingly sophisticated meme coins with actual utility features. Who would've thought we'd see utility memes? Weird times.

Predictions and Preparation for 2025-2026

So what's actually coming in 2025-2026?

Most analysts (including me) are eyeing the post-2024-halving period for the next major alt cycle. Historically, Bitcoin pumps first after halvings, then typically 6-9 months later, alt season kicks in hard. That would put a potential peak somewhere around late 2025 or early 2026.

That's my base case too, though I've been positioning earlier than most people think is reasonable. Been slowly accumulating some beaten-down L1s since mid-2023. Friends think I'm crazy for buying during the bear, but I've repeatedly learned that by the time everything looks bullish, you've already missed the best entries.

Key Trigger Events to Watch (2025-2026)

• Post-Halving Bitcoin Consolidation: After the 2024 halving rally settles, watch for Bitcoin to establish a trading range

• Additional Ethereum ETF approvals could trigger the next wave of institutional altcoin adoption

• Significant user growth on Arbitrum, Optimism and other L2s could signal the next adoption wave

• DeFi 3.0 Emergence: New composable DeFi protocols built on improved infrastructure could lead the next innovation cycle

• Watch for major gaming companies launching blockchain integrations

The Web3 gaming space is my personal dark horse bet. Most crypto games have been absolute garbage so far (I've tried at least 30 of them), but a few upcoming titles are genuinely fun first, crypto second. I've got about 8% of my portfolio in gaming tokens that I think could explode when better games finally arrive.

Why I Started CoinMinutes (And Why You Might Actually Want to Check It Out)

CoinMinutes was born out of my own expensive mistakes and weird chart obsession. We're not Bloomberg or anything fancy - used to just be me and two other crypto degens (Jake from earlier is our DeFi guy) who spend wayyy too much time analyzing this stuff.

Our newsletter is kinda like this article but weekly, and includes:

• Market updates that don't suck (I write these usually half-caffeinated at 6am)

• Where money's actually flowing (not just what CT influencers are shilling)

• "FOMO Check" sections when I notice everyone getting too excited about garbage

• Security warnings

• Deep dives on projects that aren't being hyped yet

If you've read this far, you're probably the kind of person who'd enjoy our slightly unhinged but hopefully useful takes.

Check us out at https://coinminutes.com/ if you want, or don't - I'm not your dad. But our free Friday emails are pretty good, just saying.