Despite Bitcoin’s recent price drop causing significant losses for many altcoins, there might be a silver lining on the horizon. The Bitcoin Halving event in April could be the catalyst needed for the altcoin market to bounce back and hit new highs.
Bitcoin Halving: A Pathway to Altcoin Success?
Every four years, Bitcoin undergoes a Halving event that cuts the rewards miners receive in half. This reduction in supply has historically sparked bullish trends for both Bitcoin and altcoins.
Crypto analyst Wise Advice believes that each Bitcoin Halving sets the stage for a substantial rise in altcoin prices. The analyst said:
I know when altcoin season will happen. And I’ll show you it… ‘Halving’ It all depends on it When halving happens, after 1-1.5 years, the BTC ATH comes. And near that, ETH and other altcoins boom.”
Historically, the period following a Halving has seen a surge in altcoin prices due to increased attention and the reduced availability of Bitcoin. For instance, after the Bitcoin Halving on November 9, 2021, major altcoins like Ethereum (ETH), Solana (SOL), Polkadot (DOT), and Avalanche (AVAX) hit new all-time highs.
2nd Halving Bull (December 2017):
– Ethereum: $1,400 (first week of January)
– Bitcoin Cash: $4,300
– Litecoin: $375
– Monero: $476
1st Halving Bull (November 2013):
– Litecoin: $2 -> $53
– Peercoin: $0.37 -> $9
– Namecoin: $0.44 -> $16.3
Why the Halving Might Signal an Altcoin Season Now
According to Wise Advice, these patterns indicate a consistent trend: after a Halving, funds often move from Bitcoin to altcoins, boosting their market positions. The analyst explained:
The more they buy, the higher the price goes. And it makes investors profitable. They sell a part of it and send to Ethereum and other tokens. The market cap of these is way lower, so even the inflow of $100 million can make a huge change (a month before the ATH, Bitcoin MC was 2.5 times larger than Ethereum’s).
That’s why Solana and Polkadot’s ATH was 4-5 days faster. Then money goes to even smaller Alts. And they start to overperform big ones. The smaller they were, the bigger the growth was.”
This trend is often reflected in Bitcoin’s dominance index, which measures Bitcoin’s market cap compared to the total market cap of all cryptocurrencies. A drop in this index after a Halving indicates a rising interest in altcoins.
Currently, Bitcoin’s dominance is at 54.60%, a slight decrease from over 55% earlier this month, according to TradingView. Although the index is still above 50%, suggesting a preference for Bitcoin, the recent decline might indicate the start of an altcoin season. Analysts at Glassnode have noted similarities between current market conditions and those of late 2020, when smaller stocks and riskier assets surged, hinting at a possible altcoin boom.
