Altcoin season is activated, but bitcoin dictates its own rules: Glassnode analysis
Glassnode's Altcoin Cycle Signal indicator has once again crossed the key 50-point mark, entering the so-called "altcoin season" zone. However, unlike classic scenarios, the current signal has a dual nature. The main catalyst was not the organic strengthening of alternative cryptocurrencies, but a sharp decline in the Bitcoin (BTC) exchange rate.
At the time of analysis, the indicator value reached 86, which formally indicates altcoin dominance. However, in my observation, this is more a consequence of the market leader's weakness rather than its true strength. Bitcoin has lost 18% of its value over the past month, triggering a liquidity shift into less capitalized assets. According to Glassnode estimates, sellers have nearly exhausted their potential after two years of aggressive pressure, but BTC continues to trade in the red zone.
The Fed as a Key Factor
The correction of the first cryptocurrency coincided with a tightening of rhetoric from the US Federal Reserve. Market expectations, supported by Bank of America forecasts, suggest three rate hikes this year. This traditionally puts pressure on risk assets: loans become more expensive, and interest in speculative instruments such as cryptocurrencies declines. At the same time, Grayscale's Head of Research, Zach Pandl, holds an alternative scenario, believing that the Fed will refrain from further hikes.
If this scenario materializes, the easing of fears surrounding monetary policy could become a powerful driver for Bitcoin and, consequently, for the entire digital asset market. As Grayscale rightly notes, BTC and gold have shown weaker results compared to stocks since the start of the geopolitical conflict in Iran, but if the probability of rate hikes decreases, Bitcoin could make up for lost ground.
New "Season" — New Rules
It is important to understand that high indicator values do not guarantee widespread growth. Experts, including Bitwise's Chief Investment Officer Matt Hougan, agree that the era of classic altcoin rallies is over. We are facing an unconventional season: not all assets will rise synchronously. CryptoQuant CEO Ki Young Ju emphasizes that only projects with real revenue and a working business model will survive, not just those with a new story.
My opinion: The current signal is not a call to blindly buy all altcoins indiscriminately. It is an indicator of a structural shift where capital is redistributed selectively. The key trigger for confirming a true "season" will be Bitcoin's recovery: if BTC starts to rise, pulling altcoins along with it, only then will we see a sustainable trend. For now, we are observing a temporary anomaly caused by the flagship's weakness.