This article is reprinted with authorization from Coin Market Operator, and the copyright belongs to the original author.
This week, the cryptocurrency market experienced a strong surge led by established altcoins. A group of projects issued before 2022, including ZEC, FET, FIL, and ICP, collectively exploded, dominating the top ten on Binance's gainers list. This market movement has finally given long-time sidelined investors a glimmer of hope in the darkness. Notably, on November 8, after excluding the top ten cryptocurrencies by market capitalization, the altcoin sector contributed 37% of the total trading volume, while its market cap share was only 7.3%. This significant imbalance indicates that funds are rapidly flowing into established altcoins, and market risk appetite is sharply rising.
Why might an epic market shift occur at this moment? The core reason lies in the fact that two key signals triggering a style switch have simultaneously been met for the first time: first, the violent fluctuations on October 11 have completely reconstructed the chip distribution, laying the foundation for a new trend; second, a leading coin that can consolidate market consensus and continuously guide direction has already emerged.
Firstly, although Bitcoin and altcoins will eventually converge at some point, the switch in market style is often accompanied by severe pain rather than a smooth transition. The fundamental reason is that the completion of a "high-low switch" in funds requires meeting two stringent conditions: the transfer of speculative funds from Bitcoin trends, while the historical trapped positions in the altcoin market are fully cleared.
The crash on October 11 was precisely the catalyst for this process: a large number of low-leverage positions (i.e., "old hands" holdings) were forcibly cleared in the extreme downturn, significantly unloading the historical burden of altcoins. Since then, the exchange rate of altcoins against Bitcoin has begun to strengthen, marking the opening of the channel for fund switching.
Secondly, established altcoins represented by ZEC, DASH, and ICP have rapidly ignited market sentiment with explosive gains. Their deeper significance lies in the fact that they validate the market law that "the height of the leader determines the height of the market"—the strong performance of leading coins opens up valuation space for the entire sector, driving the diffusion of profit effects. This model closely aligns with the market conditions in February 2024, when AI leaders like RENDER, WLD, and ARKM similarly opened the curtain on the last altcoin season with gains exceeding tenfold, and the current market seems to be replaying this historical script.
So, why are most of these leading altcoins projects issued before the 2022 bear market?
They possess healthier valuation and chip structures: These projects have not only undergone a complete reshuffle during the bear market, with valuation bubbles significantly squeezed, but their token economies are also more mature. Most have a circulation rate exceeding 80%, and the shares held by VCs and teams have been largely unlocked within three years, significantly releasing potential selling pressure and clearing structural obstacles for price increases.
The "sedimentation effect" of the capital cycle drives value return: History shows that after each wave of capital, despite experiencing bubble bursts, the core investments will eventually yield true winners. Just as 12% of companies initiated long bull markets after the 2000 internet bubble, the results of the 2020-2021 crypto investment peak should not be solely represented by the case of SOL. The market needs more projects from that era to realize value, which is an inherent requirement of the capital cycle.
The technological cycle's window period reinforces their "first-mover advantage": This cycle lacks disruptive innovations like DeFi Summer, with new projects mostly being technological improvements. In this context, those established projects with mature ecosystems and community consensus, having accumulated recognition and infrastructure, form a strong moat, becoming the preferred choice for funds seeking certainty amid uncertainty.
On October 11, the market cap share of altcoins (excluding the top ten by market cap) once dipped to 6.05%, marking a historical low since the ICO boom in July 2017. Behind this extreme data lies a severe proposition concerning the industry's future: if the altcoin ecosystem, which carries the majority of technological applications and innovative attempts, is abandoned by the market, then blockchain may regress into a "digital gold" system with only storage functions and no widespread application vitality, causing the grand narrative of the "value internet" to collapse. A true bull market must be built on the joint prosperity of altcoins quietly constructing in countless scenarios such as DeFi, gaming, and social interactions, beyond Bitcoin, Ethereum, and Solana. They are key to transitioning blockchain from a "ledger" to a "platform." Therefore, the current extreme slump in market share is not the end but rather a historic opportunity for re-evaluating the future of blockchain applications.
The "dry land sprouting" pattern in classic technical analysis often manifests as a long-term low-volume horizontal consolidation at the bottom, followed by a sudden surge of a massive long bullish candle. This trend is not an ordinary fluctuation but a strong signal of a fundamental reversal in market trends: it indicates that long-suppressed bullish momentum is released in an instant, reflecting that the main funds have reached a consensus and begun to enter strongly.
Observing the recent strong performance of established altcoins like ZEC and ICP, their typical "dry land sprouting" pattern precisely confirms that this is not a short-term push driven by retail sentiment, but rather an organized and large-scale collective accumulation behavior by institutional-level funds based on a consensus on valuation recovery space.
For ordinary investors, while accurately predicting trend reversals is certainly difficult, actively following when trend signals are already clear is often the most prudent strategy to avoid subjective misjudgments and seize market opportunities.
Related: How to Identify Market Manipulation Signs Before Altcoin Crashes
Original article: “This time, the big one is really coming!”
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