As bitcoin and other cryptocurrencies (altcoins) continue to grow in popularity, the cryptocurrency market becomes more dynamic and exciting. There’s always something new happening; new ICOs, altcoin pumps or dumps, and experts predicting the next big thing.
Altcoins are cryptocurrencies that run on different platforms than Bitcoin. Anytime a new cryptocurrency comes out, there is speculation about whether this platform will be better for investors than Bitcoin.
The altcoin season is a period of time (usually a few months) during which less widely known cryptocurrencies climb up significantly in price. These coins are often referred to as “altcoins”, alternatives to bitcoin. The term itself is actually misleading, as the scene has gone beyond simply “alternatives”.
Most altcoins have almost nothing in common with bitcoin’s design; for example, they may be far more energy-efficient than BTC or use different consensus algorithms altogether.
What is the Alt Season?
Altcoins can gain anywhere from 10% to 1000% in price during alt season. Even if you don’t get in at an ideal time, you can still see significant growth-but this requires a lot of research and experience with trading. The amount of money people are investing in altcoins has increased significantly. This means more people are trying to get in early on new coins, so the increases tend to be fairly steep.
The other factor driving the increased interest in altcoins is the cryptocurrency bubble. Many people are pouring their money into cryptocurrencies because they feel they can get rich quickly. They hear stories of bitcoin earning thousands of dollars overnight and believe they can do just as well. Unfortunately, most people have no idea how to manage a portfolio or understand what goes into making a successful trade.
But if you’re willing to put in the time and effort, you can see huge growth from altcoins as well.
Altcoins: What Are They?
Altcoins are a bit confusing to beginner investors. They are not the same as bitcoin, but many don’t function very differently. They may focus on a specific application of cryptocurrencies, such as anonymity or security, or offer an entirely different set of features. There can be hundreds of cryptocurrencies in existence at any time, with new ones appearing almost every day. Many have tried to imitate bitcoin’s value and some have even been success stories.
Up until late 2013, there was only one cryptocurrency market, and everyone was focused on bitcoin. There was almost no altcoin trading. But then bitcoin’s price increased by 1000% in five months, and it didn’t stop until it reached $1000. After this incredible rally, everyone wanted a piece of the action. This is when people started to realize the potential of altcoins and new cryptocurrency markets opened up to accommodate them.
What Can You Expect from an Altcoin Season?
If you have been following the cryptocurrency scene, you have probably heard of coins such as Ripple, Ethereum Classic, and Monero. These are three examples of altcoins that have been gaining massive amounts of attention in 2017. During alt season, these coins tend to go from $0 to $300 in a matter of days.
Those who know what they’re doing will take advantage of this quick gain by buying the coin for much lower prices than normal and selling it at a big profit when it’s most popular. Ripple is a coin that has been on the rise in 2017. It started at $0.0065 in May and was worth $0.68 less than a month later.
Some people were able to buy and sell Ripple for a profit of more than 18x their initial investment within this short period of time. Ethereum Classic was another coin that saw big gains during the alt season in 2017.
Signals that Precede Altcoin Season
When it comes to picking the best time to invest in an altcoin, you can’t just go on a hunch. There are many variables you have to consider before purchasing any coins. You should always do research before investing any money in a new altcoin, but altcoins that are entering their season usually have some signal that they’re about to perform well. An altcoin season can be triggered by a number of factors, including:
The Bull Run
Prices grow exponentially and threaten to overtake Bitcoin.
The Corresponding Increase in Altcoin Trading
Commissions and liquidity go up because of increased activity on the cryptocurrency exchanges.
Social Media Buzz
A new cryptocurrency reaches a fever pitch of attention on Twitter, Reddit, and other platforms.
The Hype of a Certain (Type Of) Altcoin
Some coins are more popular than others. These might be the most promising in terms of investment potential.
How to Profit During an Altcoin Season
The altcoin season is a time to take advantage of opportunities that will give you the most money. There is a lot of uncertainty in cryptocurrency markets, so you should focus on the coins that are proven to have the potential to outperform. Here are a few strategies to consider:
Buy Low and Sell High
There will be a dip in the market just before it takes off, so you should buy your coins when the prices are low and wait for them to go back up again.
If a coin has a big lead over the market and you can predict how long it will take to go up, make sure you buy it when the price is low. If you do this correctly, you can get an extra 10 to 30 percentage points in profit during every time period.
Pay Attention to Technical Indicators
Technical indicators are developed by traders to measure specific aspects of a coin’s performance, such as its volatility. This information can be used to determine how much it will go up or down during the altcoin season.
These coins tend to perform maybe 10% better than other coins during their altcoin season.
Don’t Be Greedy
You will probably realize a much higher percentage of growth if you are patient and take your time. Don’t try to get rich overnight.
the altcoin season is a great opportunity to profitably trade altcoins. If you keep up-to-date with information about cryptocurrency, you should be able to make the most of it. The best-performing coins tend to be determined by large amounts of hype, so it is important to make sure you know what people are talking about before buying in.