Key Points
- The Altcoin Season Index is currently at 35, indicating that altcoins are still in a slump.
- A decrease in Ethereum’s network growth and volume could potentially impede a price surge.
The phrase “altcoin season” has been circulating in the cryptocurrency market for several months, yet there’s little to show for it.
For this period to materialize, non-Bitcoin cryptocurrencies, such as Ethereum (ETH), need to outperform Bitcoin. However, this has yet to occur.
Altcoin Season Index
An analysis of Blockchaincenter.net reveals that the Altcoin Season Index is currently at 35. To confirm an altcoin season, the index needs to reach 75. This level was briefly achieved in late January and early March, but quickly receded.
Cryptocurrencies like ETH, Cardano (ADA), and Ripple (XRP) have seen their prices decline over the past 90 days. An altcoin season will not happen unless 75% of the top 50 cryptos outperform Bitcoin.
Ethereum’s Role
Ethereum’s surge in 2021 was a significant factor in the price increases many altcoins experienced. However, less than 20 of the top 50 altcoins have outperformed Bitcoin in the past 90 days, and Ethereum was not among them.
If demand for ETH increases, the situation could change and the token’s price could potentially reach its all-time high. This would require a significant increase in new addresses on the Ethereum network.
However, current network growth on Ethereum is unimpressive. If this trend continues, it could make it more difficult for ETH’s price to rise, further delaying the altcoin season.
Conversely, a surge in network growth could trigger a rally for Ethereum and other top tokens. Current volume for Ethereum is at $10.31 billion, significantly lower than the over $40 billion seen during its rise to its all-time high.
This low volume suggests that a significant price increase for altcoins may be unlikely in the coming weeks. It may be necessary for altcoins to stop relying on Ethereum’s performance to initiate their own rallies.
