"Altseason," a term familiar to many crypto traders, refers to periods when altcoins significantly outperform major cryptocurrencies like Bitcoin and Ethereum.

In the ever-evolving landscape of cryptocurrency, "altseason" represents a pivotal phenomenon where altcoins significantly outperform major cryptocurrencies like Bitcoin and Ethereum. This article delves into the historical patterns of altseason, exploring its implications for investors and the broader market dynamics. By analyzing previous cycles, we uncover the factors that typically trigger these explosive periods of growth, as well as the current market conditions that may signal the next altseason. Understanding these nuances is essential for both seasoned traders and newcomers seeking to navigate the complexities of crypto investing.

Understanding Altseason: What It Is and Why It Matters

"Altseason," a term familiar to many crypto traders, refers to periods when 

 significantly outperform major cryptocurrencies like Bitcoin and Ethereum. Historically, these phases have been characterized by capital rotation from Bitcoin into smaller, riskier projects, often leading to explosive growth in altcoin prices. This phenomenon has been evident in the past three major bull runs, notably in 2017 and 2021, when altcoins surged in value after Bitcoin reached new all-time highs (ATHs).

Bitcoin’s price movements have been cyclical since its inception in 2009. By analyzing historical price data, we can identify distinct periods of boom, bust and recovery. Notably, the two most recent bull runs have witnessed pronounced altseason events, whereby altcoins recorded extraordinary gains, often multiplying their market caps significantly.

For instance, during previous altseasons, the total market capitalization of altcoins surged between 6x and 7x. This explosive growth not only provided immense profit opportunities for traders, but also underscored the 

 inherent in the cryptocurrency space. However, one must also recognize that altseason often precedes the end of a bull run, as profit taking from large-cap tokens leads to a market correction.

Despite the historical significance of altseason, the current cycle appears markedly different. Bitcoin has continued to reach new highs while maintaining a strong market dominance, contrary to the typical pattern in which 

 declines during altseason. This deviation raises critical questions about the nature of the current market, and whether a traditional altseason is imminent.

The Current Landscape: Indicators and Influences

Several factors contribute to the unique dynamics of the current crypto market. First, it’s informative to underscore the importance of Bitcoin’s halving events, which historically precede significant market capitalization and dominance shifts. In previous cycles, Bitcoin's dominance tended to decline approximately 230 days post-halving, leading to a capital rotation into altcoins. However, the recent halving in April 2024 didn’t trigger the expected decline in Bitcoin dominance, suggesting a potential structural change in market behavior.

Moreover, the performance of Ethereum (ETH) relative to Bitcoin has also shifted. Historically, Ethereum served as a primary beneficiary during altseason, often experiencing substantial gains as traders rotated out of Bitcoin. However, since 2022, Ethereum has underperformed not only Bitcoin but also several competing "Ethereum Killers," such as Solana (SOL) and Sui (SUI. This relative underperformance has raised doubts about Ethereum's capacity to lead the market into a new altseason.

 has further complicated the landscape. While the introduction of these ETFs has driven Bitcoin’s price to new heights, it’s also resulted in a capital flow that remains largely focused on Bitcoin and Ethereum. Many institutional investors appear hesitant to rotate their capital into smaller, more speculative altcoins, opting instead to remain in regulated ETF products.

Last but not least, there’s been a significant increase in 

 supply, which has risen by 66% since the start of 2024. This indicates that while institutional activity may explain some market movements, retail engagement remains robust. 

 (CEXs) recorded their largest trade volumes in Q4 2024, suggesting that retail traders are actively participating in the market, potentially looking for altcoin opportunities as liquidity increases.

What Lies Ahead: Potential Scenarios for Altseason

Given the current market dynamics, traders are left to ponder whether an altseason is on the horizon and what form it might take. The accompanying report presents several scenarios that could influence the emergence and nature of the next altseason:

Advanced

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Bybit x Block Scholes Institution Report: Altcoin Rotation — Why Altseason Hasn’t Come This Time?

Feb 10, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

 explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly Highlight — Mixed Job Reports Rattle Market

The recent Bureau of Labor Statistics report indicates that U.S. job growth is slowing, yet remains healthy. Nonfarm payrolls grew by 143,000 last month, with upward revisions for November and December 2024, as they added 100,000 jobs. The unemployment rate has dipped to 4.0%, demonstrating a robust labor market, although the annual revisions suggest job gains were softer than initially reported, averaging 166,000 per month in 2024.

Simultaneously, inflation expectations are rising, driven partly by tariffs proposed by U.S. president Trump. Data from the University of Michigan reveals consumers anticipate price increases, which may complicate the Federal Reserve's decision-making. Fed officials have indicated they aren’t in a rush to lower interest rates further after a series of cuts last year, suggesting they prefer to observe how the economy reacts to potential policy changes.

The job growth in January 2025 was primarily concentrated in health care, retail and government sectors, while mining and manufacturing faced declines. Severe weather conditions contributed to nearly 600,000 people missing work, the highest impact in four years.

Despite these fluctuations, hourly wages increased by 0.5% month-over-month and 4.1% year-over-year, reflecting pressure on wages amid labor market tightness. The participation rate in the labor force stands at 62.6%, with notable contributions from foreign-born workers, highlighting immigration as a critical factor in employment growth.

As the Fed assesses the stability of the labor market, upcoming directives from the Trump administration, including potential immigration restrictions, could impact future job growth and economic conditions. While the landscape shows signs of moderation, it remains resilient, with cautious optimism surrounding economic stability.

Weekly Crypto Highlight — Crypto IPOs Coming

As reported, Gemini, the cryptocurrency firm founded by the Winklevoss twins, is potentially exploring an 

 (IPO) this year. The company is currently discussing the listing with potential advisers, although no final decisions have yet been made.

Bullish Global, a crypto exchange operator whose backers include billionaire Peter Thiel, is considering an IPO as soon as this year.

The interest in going public comes amid a surge of crypto firms accelerating their IPO plans since President Trump's election, as he has shown support for the industry. The Winklevoss twins, known for their legal battles with Facebook's Mark Zuckerberg, previously donated Bitcoin exceeding the campaign contribution limit to Trump, later receiving a refund for the excess.

Gemini employs over 500 people across several global locations, including New York, Seattle and London. Recently, the firm agreed to pay $5 million to settle a Commodity Futures Trading Commission (CFTC) lawsuit alleging it misled regulators while trying to launch the first U.S.-regulated Bitcoin futures contract. Additionally, Gemini has committed to returning at least $1.1 billion to customers affected by the Genesis Global Capital bankruptcy as part of a settlement with New York regulators relating to its Gemini Earn program.

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Weekly Institutional Insights: Mixed U.S. Job Reports; Crypto IPOs Coming

Our weekly crypto derivatives analytics report delves into macro events and the current state of crypto and trading signals from spot trading volume, as well as futures, options and perpetual contracts.

Another week brought another risk-off event in the crypto market, reflecting its correlation with equities. Despite last week's sell-off, BTC outperformed the broader market with a milder decline, evident in its derivatives positioning. Options markets initially priced short-term volatility higher, but the inversion resolved quickly. In contrast, ETH experienced a sharper inversion, with significant spikes in short-term options and realized volatility. A liquidation event led to an estimated $10 billion loss in open interest for perpetual swap contracts, 

. This bearish sentiment was reflected in funding rates, with altcoins showing a more persistent negative trend post-crash as compared to BTC.

Open interest collapsed across major tokens, flipping funding rates negative, except for BTC. ETH's realized volatility surged above 140%, its highest level in over three months, with the implied volatility term structure spiking and remaining inverted days after the crash.

Please check out the report’s highlights.

Open Interest Falls During Painful Liquidation Event

Another Monday sell-off occurred alongside a decline in U.S. equities and other risk-on assets due to fears over Trump tariffs, leading to a drop in perpetual swap positioning. Nearly $3.1 billion in open interest was wiped out from the perpetual swap markets of BTC, ETH, XRP and SOL after a late-Friday high. This decline was likely driven by liquidated leveraged positions, as traders missed margin calls during the rapid drop in spot prices. Bybit CEO Ben Zhou estimated that the true notional value of liquidated positions across markets may have ranged from $8 billion to $10 billion. The sell-off also triggered the largest spike in trading volumes in over a month, with $31 billion in perpetual swap contracts traded on Feb 2, 2025 across the four major tokens’ markets.

Altcoin Funding Rates in Negative; BTC Clings to Neutral Rates

A second consecutive Monday-morning sell-off has kept perpetual swap funding rates low and negative, indicating excess demand for leveraged short exposure. This trend likely stems from the liquidation of long positions, due to the sharp correction in spot prices. Notably, altcoins' funding rates have shown more consistency since February 3, 2024, reflecting their steeper declines as compared to BTC’s.

ETH's spot price experienced a deeper correction than BTC’s during Monday's sell-off, dropping below $2.5K. Surprisingly, options market activity remained steady, likely due to fewer at-risk leveraged long positions to liquidate, thus keeping open interest levels firm. However, the spot move caused realized volatility to spike near 140%, with options markets pricing in a significant term structure inversion that has yet to be resolved. ETH's implied volatility is approximately 15 points higher than BTC's at equivalent tenors, indicating that traders expect continued volatility in ETH's spot price.

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Bybit X Block Scholes Crypto Derivatives Analytics Report (Feb 5, 2025): Record Liquidations Result From Perp; Traders Expect More Volatility in ETH

Victoria VR leverages AI and blockchain to enhance gaming with immersive VR experiences, AI-driven interactions, and a self-sustaining digital economy.

With over 3 billion gamers worldwide (and counting), the 

 industry needs to constantly find new and innovative ways to keep their myriad participants entertained and engaged. Technologies such as virtual reality (VR) and the 

, which include augmented reality (AR) and 

, have contributed substantially to creating an immersive gaming experience.

As the metaverse continues to unlock endless opportunities for the gaming world, Victoria VR has set out on a mission to integrate artificial intelligence (AI) to improve gaming experiences.

Let’s take a deeper look at Victoria VR and the way it’s leveraging AI to tap into the gaming metaverse and upgrade users' experiences.

Victoria VR is a blockchain-powered virtual reality (VR) AI metaverse designed to leverage AI and VR to provide an immersive web3 gaming experience. 

The Victoria VR blockchain project is on a mission to create a thriving and immersive infrastructure in which the gaming world can explore its metaverse in an enhanced way.

Through AI, Victoria VR provides gaming developers with AI tools to build immersive games in a secure, transparent and scalable ecosystem. With features like the VR AI Builder and AI Agents, Victoria VR provides an AI-powered ecosystem to interact with its metaverse.

Its native token, VR, is poised to provide users with a self-sustaining virtual economy in which gaming, blockchain, the metaverse and VR content creation can interact cohesively.

To shape the future of VR through an AI-powered metaverse for immersive gaming, Victoria VR has created the following features.

The VR AI Builder is designed to simplify developers' challenges when creating VR content. Currently, VR game development requires programming skills and significant resources in terms of time and money. However, the VR AI Builder is integrated with OpenAI, making it simple to use with simple text commands. With VR AI Builder, anyone can quickly create VR content, thereby reducing costs, saving time and supporting scalable growth. It also supports integrating new AI technologies as they continually emerge.

The VR AI Builder empowers both novices and experienced developers to create and expand virtual worlds, complete with games and assets. Furthermore companies can use the VR AI Builder to create virtual buildings, showrooms and storefronts; simulate training; and provide immersive experiences to their customers.

The VR AI Builder is driven by the VR token, which plays a crucial role in building and monetizing virtual worlds.

At the heart of Victoria VR’s metaverse are its AI Agents, autonomous and intelligent creations that can independently interact and adapt in a virtual environment. These agents learn user behaviors and preferences in order to provide customized and effective support.

Creating VR AI Agents on the platform is accessible to everyone, and doesn’t require advanced technical knowledge. Some specific roles these agents can perform include NPCs in games, shopping assistants in virtual stores and even virtual teachers.

VRtap is a Telegram-based clicker PvP game by Victoria VR that uses feng shui to immerse players in an elemental adventure, helping the project community stay connected and engaged.

Some of the features of VRtap include the following:

VR is the native token that powers the Victoria VR platform. It's designed to facilitate seamless interaction on the platform and ensure a self-sustaining economy. The total supply of VR is 16.8 billion tokens, with a current circulating supply of just under 6.85 billion.

As a utility token, VR has numerous use cases on the platform, including staking, governance and diverse use in powering Victoria VR's AI and gaming aspects.

The VR token is crucial to the self-sustaining aspect of Victoria VR's gaming pillar. It’s designed to ensure long-term sustainable value for the various stakeholders in the ecosystem.

The VR token is essential for accessing and monetizing the VR AI Builder feature. Builders need VR tokens to buy VR land in order to start using the feature. Once you have VR content, you can monetize it and receive payments in VR tokens.

Furthermore, the platform collects part of the fees generated through this feature in the form of VR tokens, which boosts circulation and enhances token utility.

The VR token helps create and fuel intelligent virtual experiences through VR AI Agents on Victoria VR. VR tokens’ use cases for VR AI Agents include the following:

VR tokens facilitate user interaction with the Victoria VR metaverse via both PC and mobile versions. Users can earn VR tokens through activities such as mining and community engagement. These tokens also ensure a cross-platform economy, whereby VR tokens earned from either version can be used across the Victoria VR ecosystem.

 Perpetual contract in the Innovation Zone with up to 20x leverage. Tokens listed in the Innovation Zone are typically from new projects that may be subject to higher volatility.

As of Feb 7, 2025, Victoria VR's price was $0.007863, a 98.7% drop from its all-time high (ATH) price of $0.61 on Dec 10, 2021, and a 67.7% increase from its ATL of $0.0047 on Jan 3, 2023.

Price prediction experts are cautiously bullish on the future price of the VR token. Experts at CoinCodex believe that VR 

 a maximum price of $0.01 in 2027, and increase to $0.03 in 2030. Meanwhile, DigitalCoinPrice’s forecasting experts believe that VR 

 $0.028 in 2027 and reach $0.0425 by 2030.

That said, these bullish predictions don't guarantee the future price of VR. We highly recommend you 

 before investing in VR or any other cryptocurrency.

Victoria VR is redefining the metaverse with its AI-driven, hyperrealistic virtual world. By blending blockchain technology with immersive VR, it offers an unparalleled digital experience so users can explore, interact and create with limitless possibilities.

Victoria VR’s integration of AI into gaming through the VR AI Builder and AI Agents gives it a competitive edge, and makes the project stand out in the web3 space, making its native token, VR, an asset to watch in the web3 space.

Beginner

Victoria VR.png

Victoria VR (VR): The Ultimate AI-Driven Metaverse Experience

Candlestick

Trading

The dark cloud cover pattern tells traders that there is a potential correction ahead. But how to spot it & how reliable it is? Learn more.

Dark-Cloud-Pattern.jpg

 that crypto traders use to spot bearish reversals within the market. The pattern is fairly easy to spot and read. When traders see it, they use the pattern as a signal to enter short positions or possibly to exit long positions. 

However, the pattern should not be viewed in isolation. It’s best to get confirmation from other technical signals, like divergence on oscillators, or to see the pattern developing at an area of resistance before taking action.

When enough evidence is present, placing a bearish trade from the pattern is simple.

The Dark Cloud Cover is a bearish two-candlestick pattern in which the first candle is a large bullish range. It is followed by a bearish second candle with gaps higher on the open but closes in the lower half of the first candle’s price range.

Technical traders use the Dark Cloud Cover pattern to signal the start of a potential correction. If identified correctly, crypto traders can use the signal to exit long trades or possibly enter short positions.

The Dark Cloud Cover pattern looks like two opposing candlesticks, a large green bullish candle followed by a large red stick. Most of the price action undertaken by the green candle is unwound when the red candle is completed.

This price action indicates a developing bearish reversal in the market. Buyers appear to hold control initially, but then sellers step in and retrace a lot of the progress made.

The net effect of these two candles is that much buying power is utilized, but only to drive the price a little higher. Buyers are losing momentum, and the market is at risk of further consolidation — or outright reversal.

The Dark Cloud Cover candlestick pattern can be found in all markets, but it’s especially useful in identifying reversals on crypto charts. In addition, this candlestick formation can be spotted on all chart time frames.

How to Identify a Dark Cloud Cover Pattern

The structure of the two-candle Dark Cloud Cover pattern is fairly simple.

1 — Larger than an average bullish green candle

2 — The gap higher on the open of the second candle

3 — Large bearish red candle that retraces at least 50% of the first candle

The first candle is a bullish green candle with a larger price range than the average candle on the chart. This is important to the setup of the pattern, as it indicates a large amount of buying interest in the market.

The second candle will gap higher on its open, then work lower, finishing in the lower half of the first candle’s body (previous candle). This price action suggests an exhaustive bullish move, as the price is quickly retraced lower.

More aggressive traders may consider opening a short trade on the open of the next candle. For traders who opened an existing long position in the market, this bearish Dark Cloud Cover pattern signals the possibility of exiting all or part of the long trade.

When looking for the Dark Cloud Cover pattern in crypto charts, it’s important to note that gaps within the 

 are a rare occurrence. This is due to the 24-hour trading that’s available for crypto. In essence, there is no open or close trading in crypto, which is the most common reason price gaps appear on charts.

To accommodate this nuance within crypto, you want to see a large-bodied red candle that retraces more than 50% of the large-bodied green candle which comes right before it.

Aside from the three critical elements of the Dark Cloud Cover pattern noted above, other criteria strengthen the signal. 

First of all, the candlestick pattern is bearish, so it works best at the end of an uptrend. If the market is moving lower, then this pattern occurs doesn’t provide a good risk-to-reward ratio opportunity.

Secondly, you may find oscillators and other 

 displaying overbought values, as the trend has been strongly planted to the upside. As these oscillators turn lower, they’re likely to diverge from the price action, creating a lower high on the oscillator but a higher high on price.

At this stage, the uptrend is still in force but has weakened substantially. This could be due to a wave relationship or resistance level looming overhead. Either way, the market tries to rally one last time, but that rally is met with strong resistance — and a big red candle carving the Dark Cloud Cover pattern.

The Dark Cloud Cover pattern above suggests the market is changing from an uptrend to a downtrend. A break of support will confirm the trend has changed, opening the door for a deeper correction.

Crypto traders use the pattern with other technical signals to enter into new short positions or exit signals to close out long positions.

The Dark Cloud Cover pattern by itself is a simple two-candle pattern. However, identifying it correctly on a crypto chart requires careful consideration of other criteria.

Here is an example of an 8-hour Ether chart. ETH was in a strong uptrend with nearly 100% gains, but those gains started to slow down in early May 2021.

 (RSI) oscillator was consistently in overbought territory. However, the rally lost momentum as RSI began showing lower highs while Ether’s price continued to all-time highs.

Shortly thereafter, the Dark Cloud Cover candlestick pattern appears. The first green candle shoots higher to new all-time highs. Then the second candle of the pattern, the red candle, closes in the lower half of the range of the first green candle.

This indicates that the uptrend is losing its momentum, signaling a downturn. However, the market is at all-time highs, so it is difficult to tell for sure that a bearish reversal pattern would show or be sure trend reversal is approaching.

A trader will want to add a trend line that encompasses the uptrend to gain an additional sense of when the market’s mood is changing from uptrend to downtrend. Where the trend line breaks, the trader will have confirmation that a correction is at hand. 

You can also look to horizontal levels of support and wait for price action to break it. Then you can initiate a short position or use the opportunity to exit long positions.

Once the trend line is broken, ETH begins a sharp correction that drains about 55% of the value out of Ethereum. This correction was forecast with the combination of the Dark Cloud Cover candlestick pattern, RSI divergence, and a support trend line break. 

How to Trade the Dark Cloud Cover Pattern

Once you’ve spotted a Dark Cloud Cover pattern, trading it is fairly simple. There are multiple ways to trade, based on whether you’re a more conservative or aggressive trader. 

The more conservative approach allows you to witness additional trend confirmations before entering short. The more aggressive approach puts you in the short trade quicker but with greater potential to act on a false signal and get stopped out of the trade.

Let’s explore each of these approaches on a recent Dark Cloud Cover for Bitcoin.

Before the pattern manifests, we need to see a prior uptrend. From July 16 to August 17, 2020, the price of Bitcoin rallies 38%.

Next, we need to see a larger-than-average bullish candle driving higher to form the first candle of the pattern. The second candle of the pattern needs to retrace at least 50% of the price range of the first candle.

In the example above, the second candle of the pattern finishes near the lower portion of the range of the first candle. Both candles are carved with larger-than-average bodies.

At this point, the market is giving us clues about a potential turn lower or perhaps a pause in the uptrend. We can look to other classic 

The glaring clue above is the formation of the Dark Cloud Cover pattern at a strong level of horizontal resistance. On August 6, 2019, Bitcoin’s price rallies were reversed at $12,342.50, creating a horizontal resistance level.

Astute market participants are watching as this bearish Japanese candlestick pattern occurs near this important level of resistance. 

Additionally, we can see the RSI oscillator diverging against Bitcoin’s price. This is yet another bearish symptom, suggesting the market may turn lower.

At this point, the opportunity appears strong, so an aggressive trader can initiate a short position on the open of the next candle. The stop loss would be placed just above the recent swing high, which is likely to be the high of the pattern.

Traders look to target at least twice the distance to their stop loss. This gives the trader a 1:2 risk-to-reward ratio.

There are times when clues to a turn lower aren’t as strong, and the trader may want to be more conservative in their setup. Conservative traders can look for a break of a support trend line to provide the confirmation needed to initiate a short trade.

The trade setup would be similar to the aggressive approach, where the stop loss is placed just above the swing high in the same place. However, the entry price will be lower as we await additional levels of confirmation. This means our target price also needs to be lowered to maintain the 1:2 risk-to-reward ratio.

Dark Cloud Cover vs. Bearish Engulfing: The Differences

To a newer trader, the Dark Cloud Cover may resemble the Bearish Engulfing candlestick pattern. Indeed, they possess some similarities, but there are a couple of differences.

The similarities are that both candlestick patterns are two-candle formations created after an uptrend. However, there are two general differences between them.

First, the Dark Cloud Cover requires the candle price ranges to be larger than average. Within the Bearish Engulfing pattern, the first candle has no size specifications.

Additionally, the second candle of the Dark Cloud Cover pattern needs to cover only 50% of the first candle. In the Bearish Engulfing, the second candle must completely engulf the body of the first candle. Therefore, the Bearish Engulfing pattern has to overlap 100% of the first candle, which could be small, but the size of the candles in the Dark Cloud Cover will be larger than average. 

Is the Dark Cloud Cover Pattern Reliable?

By itself, the pattern only suggests the potential for consolidation or a lower turn. Therefore, the trader needs to seek out confirmation signals from other technical analysis tools.

For example, not all Dark Cloud Cover patterns will form near resistance. But if they do, it provides a strong signal. All forms of resistance apply, whether trend line resistance, horizontal resistance, or a Fibonacci retracement level.

Additionally, this pattern tends to appear after an uptrend. Therefore, the indicators and oscillators will signify overbought. If the pattern appears while your indicators are flashing a sell signal, then that combination of confirmations strengthens the signal.

Again, the Dark Cloud Cover pattern can appear on all time frames of crypto charts. The longer time frame charts tend to offer more reliability than shorter, minute charts because the former’s risk-to-reward ratios tend to be better.

The Dark Cloud Cover is a Japanese candlestick pattern that is easy to spot on all time frames of crypto price charts. When correctly identified, this pattern can easily be used to set up your entry and exit signals. 

However, taken in isolation, the pattern can generate false signals. It is best for you to confirm the signals with technical indicators and further confirm the trend with 

. Whether you’re a novice trader, always trade responsibly and do your due diligence to assess the 

 before jumping into the crypto bandwagon. That is especially 

Candlestick Patterns Professional Traders Use

 – A curated list of candlestick patterns most frequently used by traders

 – Learn the basics of candlestick patterns

 (Chart basics: trend, neckline, wedges)

How to Use Dark Cloud Cover Pattern to Trade Crypto

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