The share of Bitcoin in the industry is declining, other coins are ahead of the asset in terms of growth in value, thereby attracting more and more investors. Many crypto enthusiasts believe that 2021 can be safely called the year of altcoins.
According to blockchaincenter, altcoins began to gain momentum at the end of March 2021 and at the same time the altcoin season 2021 began accordingly. As of May 16, 2021, the altcoin season index is 92%.
Let’s take a closer look at what it is. It is believed that the altcoin season is in action when 75% of the top 50 coins have performed better than Bitcoin over the past 90 days. All new capital goes to altcoins, not Bitcoin.
According to CoinMarketCap data, the Bitcoin Dominance Index, which measures the market capitalization of BTC relative to the rest of the cryptocurrency market, hit a low of 39.99%. Since January 2018, it has not dropped below 50%. Thus, it became a signal that altcoins are of interest to investors more than the main cryptocurrency.
Why does the altcoin season happen?
The alt season is dependent on market capitalization because when Bitcoin rises, many investors are eager to buy it. Thus, Bitcoin is growing, updating more and more new highs. This is followed by an inevitable price correction of Bitcoin. The trading volume of the main cryptocurrency is greatly reduced and starts to float. As a result, investors redirect their assets to altcoins, expecting a profit from them.
Thus, when capital begins to accelerate away from Bitcoin towards alternative coins in the market, we can assume that the altcoin season is starting.
This was also noted by Michaël van de Poppe (a trader from the Amsterdam Stock Exchange, technical analyst, and coach):
Why is Dogecoin (DOGE) considered an indicator of the altcoin season?
Dogecoin (DOGE) is a cryptocurrency that appeared back in 2013. Thus, it is considered one of the oldest altcoins on the cryptocurrency market. This coin was created not in order to solve some global problems, but for the sake of a joke. The name and image of the currency is also a joke: the cryptocurrency is named after the meme doge – a Shiba Inu dog. Soon, this coin began to be associated by everyone with a sharp jump in prices due to its not very high value and concentrated holdings. Some investors have started counting every jump in the DOGE price as a new leading indicator for the crypto alt season.
This is because Dogecoin has featured the top 3 high potential price spikes that preceded the broader altcoin rally:
- July 7, 2020 (price increase by 73% in less than 2 days). As a result, after a couple of weeks, altcoins had a bull run and their market capitalization reached $130 billion in just 10 days.
- Beginning of 2021 (next gain with a price of 182% in just 2 days). Consequently, this caused a 50% jump in other altcoins and the market capitalization increased to $340 billion.
- The third jump on January 18, 2021 was very high potential. Just imagine that the price of DOGE has increased by 1000%. Thus, after three days, the market capitalization of altcoins began to rise by 60% to $560 billion.
DOGE reached its all-time high of over $0.7376 per coin on May 8, 2021. While Dogecoin is justifying itself as a new indicator of growth for other altcoins, its new all-time high may again portend a positive upside momentum for altcoins in the near future.
What are the top 10 altcoins 2021?
Cryptanalysts of the blockchaincenter service provided a chart with the best altcoins of 2021.
They believe that the Polygon (MATIC) token, which price has recently increased by 1372.4%, is the best performing. Crypto enthusiasts are also positive about this cryptocurrency:
The second place is taken by the Dogecoin (DOGE) cryptocurrency, which increased in price by 819.5%. Crypto experts also continue to make optimistic forecasts for the growth of the price of this coin.
Such cryptocurrencies as Ethereum Classic (ETC) (581.4%), BitTorrent (BTT) (459%) and Solana (SOL) (429.6%) are also among the most promising altcoins 2021. Here’s what the Twitter community thinks about them:
It is also suggested that you look at such cryptocurrencies as THORChain (RUNE) and PancakeSwap (CAKE). On May 19, 2021, RUNE reached its all-time high of $21.26 per token. Altcoin CAKE hit an all-time high on April 30, 2021 of over $ 44.18 per token.
The top 10 altcoins 2021 also include Binance Coin (BNB) (362.2%), VeChain (VET) (266.2%) and Terra (LUNA) (199.8%). Over the past 2 months, they have reached their new all-time highs.
About 30 altcoins that were not included in this list were performing well over the past 3 months. Among them: XRP (180.5%), TRX (152%), EOS (130.1%), ETH (115.1%), as well as DOT (62.7%) and LTC (51.4%).
The Crypto World is gaining greater legitimacy and wider adoption day by day, and it is offering some really exciting opportunities right now that it would be a shame to miss out on. However, you need to be attentive, minimizing your risk and maximizing your profit potential over the long term, making sure that once the alt season ends, your money will continue to earn you a sizable profit.
SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.