The Night Before the Alt Season Erupts: How to Build a Suitable Alts Investment Portfolio?

Written by: cyclop

Compiled by: Tim, PANews

These are the clearest bull market signals I've seen in my seven years in the crypto market:

BTC is close to its all-time high.

Retail interest is near historical lows.

ETH/BTC exchange rate breaks out of a 3-year downtrend

The altcoin index has rebounded from the lower range.

Every factor has triggered a season of knockoffs. Now they are all gathered together, which will create a resonance.

Is this really the beginning of the next wave of altcoins?

I can't believe I'm actually saying this, but I truly believe we are finally about to witness a surge in altcoins.

In this lengthy themed post, I will provide a detailed analysis:

How to Change Market Sentiment and Why Bullish

What changes have occurred that ultimately made the counterfeit season a reality?

Important Future Catalysts

Key Indicators and Their Signaling

Which altcoins may surge?

How to build an appropriate altcoin seasonal investment portfolio

How to research projects that are difficult to implement

I have been in the cryptocurrency field for 7 years and have witnessed dozens of market structures that trigger altcoin seasons.

Yes, there have indeed been some changes to the cycle, and I have detailed the process and reasons for the changes in the quoted post.

However, I believe we are at the beginning of a more lasting altcoin season, and this trend does not require Bitcoin's price to surge to $150,000 to be supported.

The narrative around BTC has fundamentally shifted from being seen as a Ponzi scheme to: a top investment target for macro hedging, the sixth largest asset by market capitalization (and recognized by S&P), a hedge against inflation, and a primary countermeasure for countries facing isolation or high inflation.

The rise of Bitcoin from its current position is no longer a necessary condition for the start of the altcoin season.

The volatility of Bitcoin's price increase (measured in percentage) will diminish, and so will its price drop. As the market capitalization expands, its price fluctuations will become such. Every year, the trend of Bitcoin becoming a store of value asset is becoming increasingly evident, rather than a speculative asset.

This is where the "value" of altcoins lies.

High market cap altcoins, especially blockchain projects, are no longer seen as "alternatives to Bitcoin." They are now viewed as technology companies operating within a broader Bitcoin ecosystem. Ethereum is like Nvidia, while Solana resembles high-performance infrastructure, and so on.

This cognitive shift has also occurred in past market cycles, each time marking the beginning of altcoin season. Now, let's discuss what actual changes took place that ultimately made altcoin season possible.

After the Pectra upgrade, Ethereum surged and broke the three-year downtrend of ETH/BTC. Every skeptic has turned into a believer. Bitcoin's dominance has just experienced the most severe three-day decline since November 2024. The sentiment in the altcoin market has dropped to an all-time low, and even after this slight rally, retail participation remains at historic lows. In my opinion, the Pectra upgrade has changed the game. The solution also addresses the biggest obstacle faced by the Ethereum-driven altcoin season: issues related to user interface and user experience.

Retail Investor Index

Despite being widely adopted, the retail investor index is currently close to historic lows. This factor has always played a key role at the beginning of past altcoin seasons. Now, it has once again become a positive signal. Let me elaborate:

It is important to understand a simple truth: assets peak when they are in an absolutely optimal state and bottom out when they are in despair and helplessness. Altcoins are still in deep trouble, but from this moment on, the only way out is to rise against the trend and rebound from the bottom.

What are the catalysts for the rise of Ethereum and other altcoins? There are many. What are the triggers for the decline? None, the market is extremely bearish. Even with a twofold increase from the bottom, the retail index (partially) has not emerged or met expectations. We have finally reached a moment where, despite altcoins having risen by 4 times, it still seems possible for them to rise another 10 times.

ETH/BTC chart

ETH/BTC has been in a downward trend for five consecutive months, which has negatively impacted ETH. Its price and attention have both declined, making it harder for altcoins to rise. After breaking through key resistance, the price of Ethereum surged, releasing a strong signal for the rise of altcoins.

Now let's take a look at some key indicators, such as:

Global Liquidity

Stablecoin Index

Shanzhai Season Index

All these signals indicate a potential trend reversal and a surge of liquidity into the crypto market, heralding the arrival of altcoin season.

But this time the counterfeit season will be different.

In the last cycle, there were fewer altcoins, so almost all coins surged. This time the situation is different: a severe oversupply makes it difficult for all altcoins to maintain their upward momentum. It is likely that less than 10% will experience significant fluctuations; the key lies in how to identify these potentials.

Your choice depends on the level of risk you are willing to take and how much profit you hope to gain.

Large-cap stocks = low profit + low risk

Mid-cap stocks = moderate profit + moderate risk

Small-cap stocks = high profits + high risks

Altcoin Research Methodology

If it is a high market cap and practical token, rather than a newly emerged Meme coin, it is better to pay attention, as the risk of encountering scams in this case is relatively low. Tokens can be analyzed based on the following aspects:

Market Capitalization

liquidity

Trading Volume

Listing situation of centralized and decentralized exchanges

Then create a list of altcoins you like.

Follow trusted KOLs and investigate whether they are paying attention to or mentioning the project.

If a project is noticed by many KOLs but they themselves are not invested in it, then this thing is mostly garbage.

Project Analysis

Start conducting in-depth research on the altcoins in your list.

Verify the following matters:

1. What is the core concept of the project? Is there a market demand?

2. How is the product quality? Please check its official website and social media platforms for details.

3. Are the project team members public? Who are they? What are their backgrounds?

Patience + Belief = A hundredfold return

A hundredfold return will not be achieved in a day, a week, or even a month.

Deeply research potential projects and hold them for the long term.

Continuously track project progress, version updates, and ecological activity.

The most important principle:

Do not overly diversify your holdings. Do not invest based on the beliefs of others. The screenshot below explains the reason.

Conclusion

Most indicators clearly suggest that the altcoin season is approaching, and all that remains is to be well-prepared. Remember: if you believe in everything, it is equivalent to believing in nothing. Don't pick dozens of projects; select at most 5 and maintain a cautious attitude.

Only in this way can you capture those less than 10% potential altcoins that are expected to achieve returns of over 100 times. If that's not enough, just look at this chart and you'll know.

0/30 bull market peak indicators have been triggered. Strange, right?