Alt season phenomenon: how do we recognize the next altcoin rally?

The crypto market follows a cyclical pattern that many investors try to predict. A crucial phase in this pattern is the alt season, a period when altcoins grow explosively while Bitcoin remains stable or loses dominance. This moment often determines the difference between those who realize gains and those who miss significant opportunities.

What determines the start of an alt season?

An alt season occurs when investors shift their capital from Bitcoin to alternative coins. This typically happens after Bitcoin has experienced a strong rally and the market is looking for other growth assets. The driving force behind this phenomenon is simple: when Bitcoin stabilizes at higher price levels, the money doesn’t just disappear—it rotates into riskier alternatives with greater upside potential.

This pattern repeats more often than you might think. Look at the difference between today (Bitcoin dominance at 55.81% in February 2026) and the extremes of the past. This suggests there is still room for Bitcoin dominance to decrease further, paving the way for an alt season.

Two decades, two monumental alt season moments

The history of alt seasons offers valuable lessons. The first major wave occurred between March 2017 and January 2018. During this unique period, Bitcoin dominance plummeted from 96% to just 36%, while altcoins gained $470 billion in market value. This was not a gradual increase—it was a complete redistribution of capital.

A few years later, a similar cycle repeated. The 2020-2021 period brought another massive alt season, peaking in November 2021. Over this 309-day explosion, total altcoin market capitalization grew to $1.5 trillion, with many projects experiencing a 650% increase. These patterns show that alt season is not a one-time event but a recurring phenomenon in bearish Bitcoin cycles.

The indicators you should follow

Investors wanting to recognize an upcoming alt season should focus on three core factors.

Bitcoin dominance as a compass: This is the most reliable indicator. When Bitcoin dominance declines (as it is now at 55.81%), capital can more easily flow into altcoins. A drop below the 50% mark usually signals a robust alt season in full swing.

Trading activity and volume growth: Rising trading volumes for altcoins indicate genuine investor interest, not just speculation. This volume inflow is often a precursor to price increases and market momentum.

Macro-economic catalysts: Global interest rate cuts and shifting liquidity flows play a crucial role. Cheaper money makes risky investments more attractive—exactly what altcoins need to surge higher.

Why this alt season (still) isn’t fully visible

Despite favorable conditions—lower interest rates and improved regulation in the US—the current market situation isn’t fully aligned with previous cycles. The cause: liquidity fragmentation. The supply of new tokens has exploded, and venture capital funding is pulling back. This spreads available funds thinner than ever before.

Additionally, on-chain statistics show a cautious picture. Active users and transaction counts remain subdued, suggesting that broad market participation, which characterizes a true alt season, is still ahead.

The path to the next alt season

Regulatory climate is improving significantly, creating a favorable backdrop. The US dollar is weakening, capital flows are normalizing, and investor sentiment is cautiously optimistic. These are the ingredients that have historically fueled previous alt seasons.

For those waiting patiently: historical patterns suggest that alt seasons are not gone forever. They await the moment when Bitcoin consolidates its role as market leader and investors turn their attention to larger growth assets. With Bitcoin dominance still well above 50%, that moment has not yet arrived—but the conditions are gradually becoming more favorable.

The next alt season will undoubtedly come. The question is: are you prepared to recognize the moment?