Traditional Altcoin Rallies Are Done, 'Unconventional' Market Cycles Coming: Bitwise CIO
Matt Hougan, Bitwise's chief investment officer, predicts the upcoming altcoin season will be 'unconventional,' favoring exclusively tokens that demonstrate genuine real-world utility and adoption.
The days of euphoric altcoin rallies where virtually every digital asset in the market experiences gains are likely finished, according to Matt Hougan, chief investment officer at Bitwise.
"I think that game is over. I think we'll see a non-traditional altcoin season," Hougan said in an interview on Wednesday. "An altcoin season that rewards assets with real-world traction and real-world application."
"I don't think we'll see the sort of rising tide lifts all buckets where you rotate from Bitcoin to ETH to DeFi to NFT pictures of rocks."
According to Hougan, upcoming altcoin seasons may witness the market "rerate" specific tokens, especially those connected to what he characterized as "huge businesses."
Altcoin season likely to be "more differentiated"
"I just think it'll be more differentiated than previous altcoin seasons," Hougan said.
Cryptocurrency traders generally anticipate, drawing from previous market cycles, that Bitcoin (BTC) would initially establish new all-time highs, followed by capital flowing into Ether (ETH) and subsequently into altcoins, initiating altcoin season.
Regarding Bitcoin, which dropped to as low as $60,000 in February recently, Hougan stated it was "starting to bottom and trend higher." Bitcoin is currently trading at $70,237 at the time of publication, according to CoinMarketCap.
Altcoin season debate continues
The discussion surrounding altcoin season has split the cryptocurrency industry, with crypto analyst Matthew Hyland stating in November that traders should maintain confidence in an altcoin season arriving soon, pointing to the Bitcoin dominance chart as "bearish for many weeks."
Meanwhile, in December, BitMEX co-founder Arthur Hayes said, "there is always an altcoin season happening."
"[If you're] always saying altcoin season isn't there, [it's] because you didn't own what went up," Hayes said.
Crypto sentiment platform Santiment said on Wednesday that mentions of altcoins on social media reached their lowest level in two years, while indicators suggest investors are focusing on Bitcoin.