The Wolf Den #1104 - Altcoin Season
When?
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In This Issue:
Altcoin Season
Bitcoin Thoughts And Analysis
Legacy Markets
MicroStrategy Isn’t The Only Buyer In Town
European Parliament Member Calls For A SBR
Bitwise Is Betting On Ethereum
BTC ETFs Have Flipped Gold ETFs
Pudgy Penguins Had A Plentiful Airdrop
Bitcoin On Fire! Is $120,000 The Next Stop?
Altcoin Season
And just like that, "Altcoin Season" has come and gone.
Okay, I admit, the opening sentence was a bit of an exaggeration to hook you in. But if your gauge of alt season is simply whether or not the Blockchain Center’s Altcoin Season Index reads “Altcoin Season,” then technically, we had a very brief season that lasted about one week.
Don’t get me wrong, I like this metric, but when I think of a true alt season, I’m thinking in terms of months, not single weeks that feel more like a portfolio tease. Let’s take a look at the real examples, using Blockchain Center’s Altcoin Season Index for the measurements.
January 1, 2018 - March 17, 2018 (75 days)
August 9, 2020 - September 14, 2020 (36 days)
March 25, 2021 - June 20, 2021 (87 days)
August 8, 2022 - September 14, 2022 (37 days)
One thing to keep in mind about the numbers I just shared is that they are based on consecutive days during which the following rule is met: “If 75% of the Top 50 coins performed better than Bitcoin over the last season (90 days), it is considered Altcoin Season.” In other words, for the conditions to be met, a significant number of coins must outperform Bitcoin over an extended period. It’s not enough for just a handful of altcoins to outperform—this wouldn't meet the stipulations of the rule.
If you ask any OGs about altcoin season, chances are they’ll tell you stories from late 2017 to early 2018 and then again in early 2021. Those are the two most memorable seasons.
Here’s a list of the biggest winners from 2017:
Ethereum (ETH), Ripple (XRP), Litecoin (LTC), Bitcoin Cash (BCH), Cardano (ADA), Stellar (XLM), EOS (EOS), NEO (NEO), TRON (TRX), IOTA (IOTA), Dash (DASH), Monero (XMR), VeChain (VET), Qtum (QTUM), Zcash (ZEC), Siacoin (SC), and Filecoin (FIL).
Here’s a list of the biggest winners from 2021:
Ethereum (ETH), Binance Coin (BNB), Cardano (ADA), Solana (SOL), Polkadot (DOT), Terra (LUNA), Avalanche (AVAX), Chainlink (LINK), Dogecoin (DOGE), Shiba Inu (SHIB), Uniswap (UNI), Litecoin (LTC), Polygon (MATIC), VeChain (VET), and Internet Computer (ICP), Algorand (ALGO), Cosmos (ATOM), Fantom (FTM), Theta Network (THETA), Axie Infinity (AXS), and Decentraland (MANA).
Looking at these two lists combined, how many of these coins remain relevant today? Which ones had successful runs in both 2017 and 2021 and could do it again in 2025? Depending on our personal biases, the answers to these questions range somewhere between the numbers I can count on one hand and, if I’m being generous, two.
This isn’t to say that altcoins are useless; rather, it’s to highlight that millions of coins are vying for a set of problems that are best suited for maybe 25 to 50 coins. This includes categories like governance, utility, memes, and stablecoins, which I consider to be the four main categories of altcoins.
To add to this, it's important to recognize that while maybe 25-50 coins might have a shot at staying power from this cycle to the next, thousands of coins will still experience explosive growth—growth so substantial it convinces anyone exposed to the asset(s) that it’s destined for generational success. This belief inevitably backfires on those who fail to take profits and see through the false promises.
On that note, I want to wrap up today with a set of principles to guide you through the altcoin season I’m expecting to kick off in early 2025—possibly with another one later in the year if the cycle stretches out.
The crypto gods have spoken, and they told me there’s at least one on the horizon, so listen up.
First on the list is to let altcoin season run its course. By this, I mean don’t get fooled by the exuberance just a week into altcoin season and end up taking profits too early, before the bulk of the run. As you saw above, the four prominent altcoin seasons lasted at least 36 days, with one stretching all the way to 87 days. And this is just based on the metric of “75% of the Top 50 coins performing better than Bitcoin over the last season (90 days).” That said, it's important to remember that there can be 49 high-performing altcoins in the early innings and another 49 later on, which could stretch the season far further. Give your winners a little bit of time.
Second is to accept the fact that your chosen altcoin, unless it’s Ethereum, Solana, or maybe a couple of others, probably won’t be relevant in the next cycle—or ever. I know that can be disheartening to hear if you’ve drunk the Kool-Aid, but unfortunately, it’s historically true, which is why I included the two lists above. To counteract this risk, I highly suggest profit-taking if you're holding more speculative assets. This is tricky to manage, especially since I just mentioned letting the season run its course, but realizing profits requires difficult decisions, and if altcoins are the path you’ve chosen, it’s a course you’ll need to navigate. Altcoin season is as punishing as it is rewarding, with the distribution of winners and losers being anything but even.
Third is to monitor trends rather than chase them. I expect several sectors and niches to perform well in the upcoming altcoin season. The ones I’ll be watching closely, with both fundamental and technical advantages, are RWAs, memes, NFTs, AI, and high-performance L1s. While there are certainly more areas to explore, my best advice is to focus on a few areas and develop a strong thesis, rather than hopping from one shiny project to the next, missing the biggest moves and failing to take profits. Picking winners among altcoins is already hard enough; letting FOMO drive your decisions makes it nearly impossible to come out ahead.
Fourth and finally, expect to fail—especially if this is your first go-around. The whole point of altcoin season and holding altcoins is to let your biggest winners make up for the losses from your inevitable losers. The same principle applies to trading. Some of the most successful traders I know only win 2 or 3 trades out of 10. They succeed because their losers are cut short with stop losses, while their winners are given room to grow. Navigating altcoins is no different. It’s a meticulous game that demands a solid understanding of sentiment, social trends, deep sector knowledge, and internal discipline. If any of those variables are missing, the whole plan can unravel. That’s exactly why I limit altcoins to 15% of my portfolio. If I hit a big winner, fantastic. If it all goes to zero, no big deal—I’m holding Bitcoin, Ethereum, and Solana, and I expect them to rise significantly in an absolute sense.
The key difference between Bitcoin and altcoins is that Bitcoin’s success stems from a steady influx of non-crypto individuals entering the space and staying, while altcoins depend on a hotbed of rotating capital and fleeting bursts of new money betting on the right horse at the right time.
Two very different games, each with vastly different outcomes.
There’s no guarantee of a mythical alt season returning, but I believe it’s coming, and Q1 feels like the most likely time for it to happen. Bitcoin historically performs well in Q4, which is where we are now, and Ethereum tends to shine in Q1. If the spillover effects materialize, they could be nothing short of epic.
Lastly, this is not financial advice, but I encourage you to focus primarily on the majors. It’s where solid returns can be locked in without stress. Then, with an amount you’re comfortable losing, you can look for the big winners if that’s your thing. Altcoin season isn't here yet, so there’s still time to pick your winners and stay patient.
In other news, the Bitcoin Policy Institute drafted an Executive Order for a Strategic Bitcoin Reserve for President Trump, which I plan to cover in more detail tomorrow.
I’m not going to lie; this is kind of how I am feeling:
Maybe $150,000 is a more reasonable immediate response to a signature, but holy cow, it’s happening.
Bitcoin Thoughts And Analysis
Recent Price Action:
Bitcoin has continued its uptrend, reaching a high of $108,000 and closing near $104,949 yesterday.
Yesterday's Candle: The candle shows a long upper wick and a small body, resembling an inverted hammer or shooting star pattern. This suggests rejection at higher levels, indicating some selling pressure as the price attempted to push higher.
Today's early price action is showing minor follow-through to the downside, confirming caution from yesterday's rejection. We need to watch the daily close.
Key Support and Resistance Levels:
Resistance:
The psychological level at $106,000 is acting as the near-term resistance.
Support:
Immediate support is at $99,860 (recent breakout level).
Below that, $73,835 remains a critical support zone.
If the price pulls back, a retest of $99,860 would be a healthy correction within the bullish trend.
RSI Analysis:
The RSI remains elevated but below overbought territory (~70–80), indicating strong bullish momentum but also signaling potential for a cool-off period.
Divergence is not yet confirmed, but if RSI fails to make a new high while price advances, it could signal weakening momentum. We want to avoid clear bearish divergence confirming today.
Moving Averages:
The 50-day SMA (blue line) is trending strongly upward and sits around $91,000, offering a dynamic area of support in case of deeper retracement.
The 200-day SMA (red line) is far below at $70,000, reinforcing the bullish long-term trend.
Volume:
Volume during the recent move higher has been declining slightly, which could suggest weakening buying interest. If volume continues to drop, a short-term retracement or consolidation becomes likely.
Interpretation of Yesterday's Candle:
The rejection wick near $106,000 signals that buyers may be losing some momentum at this level.
If today’s candle closes bearish or below $104,000, it would confirm short-term selling pressure and set up a potential pullback toward $99,860 (previous resistance, now support).
Outlook:
Bullish Case:
If Bitcoin reclaims $106,000 and closes with a strong candle, the next psychological target could be $110,000–$115,000.
Maintaining higher lows and bouncing off $99,860 would confirm trend continuation.
Bearish Case:
Failure to hold above $104,000 and rejection from $106,000 could trigger a pullback toward $99,860.
A breakdown below $99,860 could extend the correction to the 50-day SMA near $91,000, which would still be a healthy retracement in the broader uptrend.
Legacy Markets
Global stocks rebounded on Wednesday as investors awaited the Federal Reserve’s final policy decision of the year, with a focus on the outlook for 2025 amid slowing inflation and a resilient economy. U.S. futures rose modestly, while European and Asian markets also saw gains. Commerzbank shares climbed after UniCredit increased its stake, and Nissan surged on news of potential merger talks with Honda. The Fed is widely expected to deliver a quarter-point rate cut, but uncertainty looms over future cuts, with analysts predicting fewer reductions than previously anticipated. Treasury yields held steady, reflecting market recalibrations around inflation and policy expectations, while the dollar remained little changed. Elsewhere, Bitcoin paused after surpassing $108,000, oil steadied, and the Canadian dollar hit a multi-year low as Brazil intervened in currency markets to support the real. Markets remain cautious as they assess the Fed's communication and policy trajectory.
Key events this week:
Eurozone CPI, Wednesday
US rate decision, Wednesday
Japan rate decision, Thursday
UK BOE rate decision
US revised GDP, Thursday
Japan CPI, Friday
China loan prime rates, Friday
Eurozone consumer confidence, Friday
US personal income, spending & PCE inflation, Friday
Some of the main moves in markets:
Stocks
S&P 500 futures rose 0.2% as of 6:03 a.m. New York time
Nasdaq 100 futures rose 0.2%
Futures on the Dow Jones Industrial Average rose 0.2%
The Stoxx Europe 600 rose 0.3%
The MSCI World Index was little changed
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.0498
The British pound was little changed at $1.2717
The Japanese yen was little changed at 153.60 per dollar
Cryptocurrencies
Bitcoin fell 1.7% to $104,589.31
Ether fell 1.4% to $3,875.24
Bonds
The yield on 10-year Treasuries was little changed at 4.40%
Germany’s 10-year yield advanced two basis points to 2.25%
Britain’s 10-year yield advanced three basis points to 4.55%
Commodities
West Texas Intermediate crude rose 0.6% to $70.51 a barrel
Spot gold was little changed
MicroStrategy Isn’t The Only Buyer In Town
While MicroStrategy continues to dominate the headlines, several companies—particularly Bitcoin mining firms—are quietly following a similar path. If current trends persist, these companies could significantly ramp up their acquisitions, much like their high-profile predecessor.
Semler Scientific, Riot Platforms, and MARA have significantly increased their Bitcoin holdings, reflecting institutional confidence in the asset.
Semler Scientific acquired 211 BTC for $21.5 million at an average price of $101,890 per BTC, bringing its total holdings to 2,084 BTC, purchased for $168.6 million at an average of $80,916 per BTC. This strategy has delivered a 67% quarter-to-date increase and a 92.8% return since adopting Bitcoin in May.
Riot Platforms used proceeds from a $594 million convertible bond offering to buy 667 BTC at an average price of $101,135 per BTC. Its total holdings now stand at 17,429 BTC, valued at approximately $1.8 billion at a market price of $103,873 per BTC.
MARA used proceeds from its zero-coupon convertible notes offerings to acquire 11,774 BTC for ~$1.1 billion at an average price of ~$96,000 per BTC. The firm achieved a BTC yield of 12.3% quarter-to-date and 47.6% year-to-date. As of December 9, 2024, MARA holds 40,435 BTC, currently valued at $3.9 billion based on a spot BTC price of $96,500.
European Parliament Member Calls For A SBR
European Parliament member Sarah Knafo has called for the European Union to adopt Bitcoin as a strategic reserve while rejecting the digital euro, which is a CBDC. In her speech, Knafo warned that a centralized digital currency could enable totalitarian financial control and criticized the ECB's policies for exacerbating inflation and poor economic decisions. She argued that Bitcoin offers a decentralized, transparent alternative and highlighted examples like El Salvador's Bitcoin adoption and the U.S.'s favorable stance. Knafo also accused European regulators of stifling innovation, as the ECB delays its digital euro decision until October 2025.
Bitwise Is Betting On Ethereum
I’m a sucker for the free Bitwise weekly memo, written by Matt Hougan and his team. It’s packed with valuable insights and only requires an email to subscribe—well worth the read.
This week, the focus was on Ethereum, and specifically, on how the market is overlooking, “one of the biggest and most overlooked opportunities,” specifically tokenization.
I’ve been talking about tokenization this entire cycle, even at times when attention in the space was everywhere but Ethereum. If this narrative takes shape with equities, which likely requires a green light from the SEC and various regulators, Ethereum will surpass every expectation and then some.
BTC ETFs Have Flipped Gold ETFs
Bitcoin ETFs continue to impress in every way imaginable. The next milestone? Spot Bitcoin overtaking spot gold in market cap. With gold currently valued at $17.824 trillion, Bitcoin’s market cap would need to increase by 8.37x, putting its price at approximately $900,000. I have no doubt it will eventually happen, but my timeline for Bitcoin flipping gold is closer to 2030. One milestone I do expect this cycle, however, is Bitcoin overtaking Apple in market cap, which currently sits at $3.823 trillion. For that to happen, Bitcoin would need to 1.79x, reaching a price of around $192,000.
Pudgy Penguins Had A Plentiful Airdrop
By the time you read this, a lot could change, but as of the time of writing, the PENGU token dropped over 50% after its airdrop to Pudgy Penguins NFT holders went live. Initially rising to $0.068, it quickly fell to $0.031 due to heavy selling pressure. This decline coincided with a drop in Pudgy Penguins NFT prices, with the floor price falling from 33 ETH to 16 ETH. The collection, once the second-largest by market cap, dropped to sixth place as Bored Ape Yacht Club and others reclaimed the top spots. Despite launching with a $2.3 billion market cap and generating $90 million in trading volume, PENGU’s market cap is now under $1.9 billion.
Okay, so that covers the stats, but what about the project overall, apart from falling prices? I think Pudgy Penguins is doing everything right. I don’t own one, but any NFT brand that has reached mainstream appeal and brand recognition is doing things right. Falling prices are to be expected when a token launches alongside a falling floor price. Pudgy Penguins were bid up because the trade was hot, and an airdrop was involved. I anticipate the floor price of this project to steadily climb as NFTs continue on their comeback.
P.S. - If you own this or plan to purchase the token, please take the time to research the tokenomics and vision behind the coin. This is a very cutthroat space to launch a token.
Bitcoin On Fire! Is $120,000 The Next Stop?
Bitcoin broke another all-time high and almost reached $108K. I am joined by Andrew Parish from Arch Public and Paget Stanco from Gemini to explore what's next for Bitcoin and crypto!
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.
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