When will the true era of altcoins arrive? Insights from 10x Research on observing changes in the Bitcoin Leading Indicator

When will the true era of altcoins arrive? Insights from 10x Research on observing changes in the Bitcoin Leading Indicator

When will the true era of altcoins arrive? Insights from 10x Research on observing changes in the Bitcoin Leading Indicator

With Ethereum (ETH) approaching the $3,000 level, the market is increasingly calling for a potential “Altcoin season.” However, some analysts warn that it may not arrive as quickly as anticipated. Henrik Andersson, the Chief Investment Officer of Apollo Capital, stated in an interview with Cointelegraph that he believes there are several strong catalysts on the horizon that could trigger a rebound in altcoins. These catalysts primarily come from Ethereum’s fundamentals, such as the Dencun upgrade, scaling solution Blast, and the mainnet launch of the re-collateralization platform EigenLayer. Yuga Cohler, a senior engineering manager at cryptocurrency exchange Coinbase, also stated on the X platform, “We are entering an ETH bull market: the beta of altcoins.” Markus Thielen, the founder of 10x Research, expressed a different opinion regarding the altcoin season, stating that there is still a lack of evidence indicating its imminent arrival. Thielen explained that it is necessary for Bitcoin’s dominance to continue declining to below 45% in order to initiate a sustainable altcoin season. Bitcoin dominance refers to Bitcoin’s market capitalization as a percentage of the total cryptocurrency market, which is currently around 53% according to TradingView data. Thielen also noted that the recent altcoin rally quickly faded, indicating that Bitcoin investments have a higher risk-adjusted potential. Furthermore, Ethereum’s rally appears to be driven by the potential approval of a spot ETF in May rather than the growth of on-chain activities in decentralized applications. Santiment, a blockchain analytics company, released a report on Tuesday stating that since the volatility of the cryptocurrency market began in October, “the vast majority” of cryptocurrency projects have brought profits to ordinary wallets in the medium to long term, except for a few underperforming altcoins. However, Santiment cautioned that its model is showing overbought signals and cited the Market Value to Realized Value ratio (MVRV), which indicates that “buying or establishing new positions carries higher than average risk when the market is in a four-month period of strong growth.”