Republished with permission: “How Far Are We from Full Altcoin Season? | Trader Watch”

On August 12, Ethereum broke through $4,700, marking a four-year high. @CryptoHayes, who had taken profits early last week, re-entered Ethereum positions on August 9. Bitcoin also posted new highs, and total crypto market capitalization surged to $4.2 trillion, sending market sentiment into overdrive.

Traditional markets are also rallying. Both the S&P 500 and Nasdaq 100 have reached record highs, with global liquidity rushing into risk assets. The U.S. Dollar Index (DXY) fell below 98, paving the way for greater capital flows into stocks and crypto. This macro backdrop not only reinforces the uptrend but also steadily builds investor confidence in higher-risk assets.

At the same time, the market is almost certain the Federal Reserve will cut rates at its September 17 meeting—likelihood is nearly 100%—bringing the benchmark interest rate to a 4.00%-4.25% range. This expectation further boosts highly liquid markets, particularly cryptocurrencies. Wealth creation during altcoin season has become a key talking point, with everyone watching for the signal of a full-scale kickoff.

Below, BlockBeats has compiled traders’ perspectives on the market outlook to help guide your trading decisions this week.

@b66ny

BTC dominance (BTC.D) has been showing a clear downward trend, having retreated from previous highs to about 57.7%. When combined with moves in ETH dominance (ETH.D), this is a classic sign of capital rotation: funds are moving out of relatively stable assets into higher-risk, higher-return opportunities. Historically, a sustained drop in BTC.D is a key precondition for the start of altcoin season.

ETH.D isn’t just about Ethereum’s relative strength; it frequently serves as a leading indicator for the entire altcoin market. Right now ETH.D is strong again, with dominance rebounding to 14.0%, and the ETH price has rallied swiftly. The ETH/BTC ratio shot up more than 4% in 24 hours, showing clearly that capital is moving from Bitcoin to Ethereum.

This sequence is the textbook scenario for capital rotation: In stage one, BTC stalls or pulls back, prompting capital to flow into ETH. Ethereum’s gains bolster market confidence and create the conditions for more liquidity to spill into the altcoin market.

The next metric to focus on is OTHERS.D—dominance for mid-cap and small-cap altcoins, excluding BTC and ETH. OTHERS.D is still in a prolonged period of consolidation near its bottom, and hasn’t seen the kind of explosive growth ETH.D has. That means the capital frenzy remains focused on a handful of top assets like ETH. Despite noticeable gains in SOL today, and increasingly clear rotation signals, capital has not yet reached the most speculative small-cap tokens.

Considering all three major indicators, the market is likely still in the early phase of this rotation cycle:

Already in motion: BTC.D is dropping; capital is exiting Bitcoin.

Happening now: ETH.D is rising; capital is flowing into ETH.

Not yet: OTHERS.D rising, signaling capital spreading into mid-cap and small-cap altcoins.

@im_BrokeDoomer

Looking at the market cap ratio of altcoins versus Bitcoin since 2017, we’re now at a critical support level at the bottom of the channel. Historically, this spot has been prime for fresh capital inflows and often marks a turning point with improving sentiment and accelerating rotation. If this support holds up, the altcoin sector could see a broad-based rally—signaling the official start of a new altcoin season.

The usual playbook for altcoin season is: Bitcoin (BTC) kicks off the run → Ethereum (ETH) follows with its own rally → BTC surges again → ETH breaks its all-time high (ATH) → large-cap altcoins move higher → BTC reaches a new high → ETH and large-caps hit new records together → mid-cap altcoins take flight → small-caps see explosive growth across the board.

We are now in the third stage, with ETH and large-cap altcoins achieving new highs. Broader altcoin breakouts are increasingly likely in the near term.

@ZssBecker

During the last bull run in 2020, most altcoin narratives didn’t take off right away. The real action began only after ETH broke its previous high and tripled in value. At that point, a flood of money rushed into new narratives—like gaming—sending those tokens soaring by 10x, 20x, even 50x. Sandbox skyrocketed 80x. Even the most obscure, low-substance projects in the gaming vertical were going 10x and beyond. That sort of phenomenon only took off in the second half of the bull market, but when it did, it produced a massive wealth effect in a short time.

I expect history to repeat itself in this cycle. We’re still in the opening phase of this altcoin season, dominated by BTC and ETH. Only when ETH breaks through $5,000 and mainstream altcoins notch 2–3x gains will capital go hunting for the next big narrative. The top contenders this time: AI, RWA (real-world assets), and gaming. These three sectors are already being actively integrated and monetized across the crypto industry and have both a strong investing narrative and the potential for big returns.

Last cycle’s gaming narrative turned a few thousand dollars into millions for many. This time the pool of capital is much larger, and risk appetite is even higher. Once the move starts, capital rotation will be even more aggressive. For investors, the key isn’t to chase now, but to stay patient and position early. The peak of altcoin season will occur when the next narrative gains momentum.

@lanhubiji

If you understand market structure, it’s clear that altcoin season is inevitable—but the way it unfolds may be entirely different from previous cycles. In the past, altcoin supply was limited and capital was highly concentrated, so virtually every leading sector enjoyed market-wide rallies. Now, with over a million tokens available, competition is extremely fragmented. There’s no way capital can reach every project.

That means we’re more likely to see a “localized altcoin season” this time: capital will cluster around a handful of sectors or tokens with compelling narratives, strong communities, and ample liquidity, sparking localized frenzies, even as most coins remain sidelined. Opportunities still exist for investors, but the chances of picking winning assets are much lower than before. My top pick remains the AI sector.

@joao_wedson

The genuine altcoin season is still a long way off. Sophisticated capital typically moves from BTC to ETH, then to leading large caps, and finally to mid-cap and small-cap tokens. Right now, we’re barely halfway through this progression; the real “altcoin mania” is still ahead, and could easily last through November. In short, what we’re seeing now is just an appetizer—the main course has yet to be served.

Disclaimer:

1. This article is republished from [BlockBeats], originally published as “How Far Are We from Full Altcoin Season? | Trader Watch.” Copyright belongs to the original author [kkk]. If you have concerns about this reprint, please contact the Gate Learn Team, and we will handle it promptly according to our procedures.
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