Total Altcoin Market Cap Surges $215 Billion in 3 Days: First Signal of the Season?
The total market capitalization of altcoins increased by $215 billion between August 19-22, surpassing $1 trillion, while 56% of altcoins traded on Binance crossing their 200-day moving average was seen as an early signal for altcoin season; however, the market entering the overbought zone has increased short-term risks.
According to CryptoQuant’s analysis, this jump in altcoins occurred in just three days. The Total2 indicator, which tracks the total market value of the cryptocurrency market excluding Bitcoin, rose above $1 trillion again. The rally accelerated particularly among mid-cap and small-cap altcoins.
Distribution data from Binance showed that the movement has spread across the market. During the stagnation period that began in November, approximately 80% to 85% of altcoins were trading below their 200-day moving average (200-DMA), which shows an asset’s average price over the last 200 days. Now, 56% of altcoins have moved above this level. Staying above this average is generally associated with a bullish trend. In the final section of the chart, the ratio of altcoins remaining below the average is shown as 44.7%.
First Signal for Altcoin Season Has Arrived
Donald Trump’s statements on August 19 were influential in the timing of this transformation. Trump stated that the US would purchase a significant amount of Bitcoin and called on Congress to pass the Clarity Act. He also argued that the war against crypto is over. These statements accelerated the flow of liquidity into altcoins during a period when trading volumes were low and sellers were weak.
Altcoin season refers to the period when altcoins outperform Bitcoin. Historically, gains of this scale are considered an interim signal for an early-stage altcoin season. However, the market is currently in the overbought zone. Therefore, a breathing spell or correction may be seen in the short term. Rapidly rising mid-cap and small-cap altcoins carry a risk of sharper volatility.