Bitfinex Report: Speculative Funds Shifting from Bitcoin to Altcoins, Typically Signaling the Arrival of "Altseason"

BlockBeats News, November 26th, Bitfinex released a report stating that "Bitcoin is approaching the historic $100,000 milestone, driven by unprecedented inflows into a Bitcoin ETF and strong institutional demand. Despite facing profit-taking resistance at its recent all-time high, Bitcoin has shown resilience, holding around $96,000 over the weekend, and then partially recovering its upward momentum in Monday morning trading. Since its pre-US presidential election low of $66,880, Bitcoin has risen by 47% and has seen a staggering 130% increase since the beginning of the year, charting new territory. Bitcoin's performance compared to traditional assets is undeniable: Bitcoin's market value has now surpassed Saudi Aramco, becoming the world's seventh-largest asset, with its valuation exceeding $1.9 trillion at its peak.

While Bitcoin's upward momentum is remarkable, it is not without profit-taking from long-term holders. Despite increased selling pressure, the current pressure remains manageable compared to historical peaks in March 2021 and March 2024. These trends indicate a temporary stall in market momentum, but the overall market may absorb selling pressure and continue to rise in the medium term.

The overall cryptocurrency market (excluding Bitcoin and Ethereum, referred to as the Total3 index) has also reached a new cycle high, with investor sentiment soaring, driving the Total3 index to experience a 23.2% surge from last week's low to high— the largest gain since April 2021. Large-cap altcoins such as Solana (SOL) have hit new all-time highs, signaling their breakouts beyond key resistance levels, including the April 2022 high.

The altcoin market capitalization is now approaching the $984 billion high point of May 2021, indicating speculative funds are shifting from Bitcoin to altcoins. Historically, this fund rotation often heralds the arrival of the "altcoin season," where altcoins outperform Bitcoin significantly.

In fact, the annualized funding rate of large-cap altcoins has exceeded the 45% threshold, signaling intensified speculative activity. With increased retail investor participation, short-term volatility is expected to rise, further propelling altcoin momentum. However, these conditions also need to be approached with caution, as extreme funding rates often foreshadow sharp market pullbacks."