As the market bleeds red and most altcoins lose crucial levels, some have suggested that investors need to reshape their expectations of the crypto market this cycle and the long-awaited ‘alt season’.
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The old crypto cycle is over – Analyst
Over the past month, the crypto market has wiped out more than $1 trillion in market capitalization due to a series of large-scale liquidations and strong selling pressure since the Oct. 10 pullback, sending investor sentiment to its lowest level in months.
Amid this performance, the rally buzz early in the fourth quarter has faded and most altcoins have lost the ground they gained during the market breakout in the third quarter. Market observers have shared their views on how the crypto market has changed and what to expect in the future.
In October, Nic Carter, crypto investor and partner at Castle Island Ventures, weighed in on the shift in retail sentiment regarding most altcoins. As reported by NewsBTC, he confirmed that the bearish sentiment means the space has matured significantly.
Carter explained that crypto is now “boring” because most of the uncertainties that caused much of the historical volatility have been resolved, adding that the industry has also largely been stripped of risk as a technological substrate.
The investor believes that “crypto-natives no longer control the narrative, there are more serious companies (that don’t require tokens), there is less chaos and the whole space has matured significantly.”
In a Friday thread on X also the Altcoin Sherpa discussed the market is changing and confirming that the ‘old cycles’ have been ‘dead’ for some time. As he explained, the previous cycles consisted of a euphoric phase, a correction phase and an accumulation phase before the beginning of a recovery phase.
He highlighted the performance of Altcoins like Solana (SOL) between 2020 and 2024, noting that “this market environment is gone.” Instead, the analyst believes the market is in a “hyper-accelerated regime.”
Altcoins in a ‘hyper-accelerated regime’
Under this new regime, the market is experiencing short-term upward trends followed by medium-term downward trends, similar to the price action of altcoins like BONK since late 2023, Altcoin Sherpa added:
We did 1-3 months of pumping followed by 2-6 months of downtrend and repeat flushing. There is no more euphoria where things spiral out of control for a whole year. Only 1-3 months and then down. Look how many cycles BONK has had in about 2 years.
The analyst suggested that investors should not expect 2021 conditions for most altcoins, nor a traditional ‘Alt Season’, where most tokens post huge gains all at once. He advised capitalizing when the “good times” come and being aware that “the price could still fall in three months.”
“Reframe your brain in how you think about alt pumps and ‘alt season’. Coins will still trend down, just not in a slow bleed. More [of] an accelerated destruction + carnage, Altcoin Sherpa detailed.
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He also noted that, unlike previous cycles, altcoins will also recover “a little faster than before” and will not take more than a year to bottom and accumulate before another surge begins.
However, Sherpa confirmed that the lack of an accumulation phase will mean that “total coins will NOT have as strong pumps as they used to,” as that period makes rallies strong. “We don’t see anything like that anymore,” he concluded.
Featured image from Unsplash.com, chart from TradingView.com