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

Author: cyclop

Compiled by: Tim, PANews

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

• BTC is nearing its historical high price
• Retail interest is at a historical low point.
• The ETH/BTC exchange rate has broken a 3-year downtrend.
• The altcoin index has rebounded from the lower range.

Each factor has previously triggered a season of imitation. Now they all gather together to create a resonance.

Is this really the beginning of the next altcoin season?

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 thread, I will provide a detailed analysis of:

• How the market mentality changes and why it is bullish
• What changes have occurred that ultimately made the Shanzhai season a reality?
• Important Future Catalysts
• Key Indicators and Their Indication Signals
• Which altcoins may skyrocket
• How to build an appropriate altcoin seasonal investment portfolio
• How to study projects that are difficult to land

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 in the cycle, and I have detailed the process and reasons for the changes in the referenced post.

However, I believe we are at the beginning of a more lasting altcoin season, and this trend does not need Bitcoin's price to soar to $150,000 to support it.

The narrative surrounding BTC has fundamentally changed, 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 means to combat inflation, and a primary strategy for countries facing isolation or high inflation.

Bitcoin's rise 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 the same goes for its price drop. As the market capitalization expands, its price fluctuations will become such. Every year, the trend of Bitcoin becoming a value storage asset becomes 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 regarded as tech companies operating within the broader Bitcoin ecosystem. Ethereum is like Nvidia, while Solana is akin to high-performance infrastructure, and so on.

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

After the Pectra upgrade, Ethereum surged and broke the three-year downward trend of ETH/BTC. Every skeptic became a believer. Bitcoin's dominance just experienced the most intense three-day decline since November 2024. The sentiment in the altcoin market has dropped to a freezing point, and even after this slight rebound, retail participation remains at a historic low. In my opinion, the Pectra upgrade changed the game. The proposal also addresses the biggest obstacle facing the Ethereum-driven altcoin season: issues with the user interface and user experience layer.

Retail Investor Index

Despite being widely adopted, the retail investor index is currently close to historical lows. This factor has historically played a key role in the early stages of altcoin seasons. Now, it is once again becoming a positive signal. Let me elaborate on this:

It is important to understand a simple truth: assets reach their peak when they are in absolutely optimal condition and hit their bottom when 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 reasons for the decline? None, the market is extremely bearish. Even though it has doubled from the bottom, the retail index (in part) has not appeared or reached the standard. Finally, we have reached a moment where, even though altcoins have already risen 4 times, it still seems possible to rise another 10 times.

ETH/BTC chart

ETH/BTC has been in a downtrend for five consecutive months, which has had a negative impact on ETH. Its price and attention have both declined, making it harder for altcoins to rise. After breaking through key resistance, Ethereum's price 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 liquidity influx into the crypto market, heralding the arrival of altcoin season.

But this time the imitation season will be different.

In the last cycle, the number of altcoins was smaller, so almost all coins skyrocketed. This time it was different: a severe oversupply made it difficult for all altcoins to sustain their rally. It is likely that less than 10% will see significant changes, and the key is how to find 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

Methodology for Researching Altcoins

If it is a high market value and practical token, rather than a newly emerged meme coin, it is better to pay attention, as the risk of encountering scams is relatively low in this case. 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 have关注 or mentioned the project.

If a project is being关注ed by many KOLs, but they themselves are not invested in it, then it is likely garbage.

Analyze Project

Start detailed research on the altcoins in your list.

Verify the following items:

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 = Hundredfold Returns

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

By conducting in-depth research on potential projects and holding them long-term.

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

The most important principle:

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

Conclusion

Most indicators clearly suggest that the altcoin season is approaching, and all that remains is to be fully 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 altcoins with less than 10% potential, which are expected to achieve returns of over a hundred times. If that's not enough, just take a look at this chart and you'll see.

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

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