It’s no secret that Bitcoin has been on a tear, hitting all time highs. It has taken investors—old and young—by storm. Johannesburg-based climate justice activist Amahle Nkosi explores what’s behind this explosion of youth activism. She dives into what’s behind the possibility of an altcoin rally in the near future. She blends technical know-how with a deeply people-centered approach to blockchain technology. She’s able to provide readers with the most nuanced portrait of the market dynamics at work.

What's Fueling Bitcoin's Bull Run?

Here are six reasons for Bitcoin’s meteoric rise. Recognizing these drivers is important for anyone looking to enter the extremely speculative cryptocurrency market.

That’s due to the greatly improved macroeconomic outlook. Over the last three months, the global economic picture has not only leveled off but started to expand again. This unforeseen—and largely surprising—progress has rekindled investor faith in all risk assets, Bitcoin included. This bullish sentiment has resulted in a conducive environment for Bitcoin to flourish.

The Bitcoin halving that happened April 2024 has been a key catalyst. This celebration, which is held about once every four years, represents an extraordinary opportunity. It halves the block reward for miners, thus halving the rate at which new Bitcoins are created. In reality, the past halving cut that reward in half to 3.125 BTC, which further constrains the supply of Bitcoin, making it scarcer by design.

Another fundamental factor is Bitcoin's limited supply. Unlike most other currencies, Bitcoin has a predetermined maximum number of coins. The last of these coins will be mined by around 2140. This scarcity, combined with increasing demand, makes Bitcoin particularly attractive to investors. They view it as a smart way to protect their nest egg from the gravest fortunes of inflationary theft and economic instability.

Institutional demand for Bitcoin has never been higher, giving the increase tremendous backing. Major corporations, hedge funds and institutional investors are actively deploying in Bitcoin right now. They just made a big bet on its potential as a long-term investment. This flood of institutional cash has brought a new level of acceptance to the crypto markets and skyrocketed demand for Bitcoin.

Additionally, an overall positive regulatory environment for cryptocurrencies has played a role in Bitcoin’s recent bullish trend. Fast forward to 2025, where regulatory clarity has ushered in an era of less uncertainty and brought in a flood of institutional and retail investors to the market. Strong, smart, and understandable regulations create a foundation that gives companies the ability to innovate and grow within the emerging cryptocurrency space.

Lastly, Bitcoin ETFs finally getting approved has been a turning point. The SEC finally approved the first physical Bitcoin ETFs in January 2024, with 10 funds launching on January 11, 2024. These ETFs provide investors with a regulated and convenient means to invest in Bitcoin. Those that own futures contracts on Bitcoin — which the SEC approved in October 2021 — increase this potential even further without the need to directly own the volatile cryptocurrency. Investors have a second avenue to Bitcoin through funds that invest in the equities of companies developing blockchain technology and other businesses related to crypto.

Decoding Bitcoin Dominance and the Altcoin Opportunity

Bitcoin dominance is the market cap of Bitcoin against the whole crypto market. It has been an important predictor of future market direction. Understanding its correlation with altcoin performance is key to finding investment opportunities.

Naturally, historically, there’s been an inverse correlation with Bitcoin dominance and altcoin performance. As Bitcoin’s dominance rises, altcoins often fall by the wayside, with investors gravitating to the safety and stability of Bitcoin. As Bitcoin dominance falls, alt season usually returns the spotlight to the altcoins. Investors rush into these smaller, more speculative cryptocurrencies, looking for bigger growth opportunities.

When Bitcoin dominance decreases, it usually indicates the start of an “altcoin season.” During this period, capital tends to rotate into altcoins, leading to larger percentage price increases for these other cryptocurrencies in relation to Bitcoin. This shift in investor sentiment is driven by several factors, including:

  • The search for higher returns: Altcoins often offer the potential for greater returns than Bitcoin, as they are typically smaller and more volatile.
  • Increased innovation: Altcoins are often built on newer technologies and offer different functionalities than Bitcoin, attracting investors who are interested in innovation.
  • Market maturity: A decline in Bitcoin dominance is seen as a sign of the cryptocurrency market becoming more mature and diverse, which can lead to increased investment in altcoins.

When Bitcoin dominance decreases, investors tend to reinvest their earnings into altcoins. This collective movement can catalyze a large increase in the price of altcoins. This migration of capital, from coastal to heartland markets, creates interesting opportunities for savvy investors. Those who are willing to accept the much higher risk involved altcoins can be very rewarding.

Bitcoin dominance is a primary signal of market maturity. When dominance is going down, that’s a good indicator that the market is actually diversifying out and including altcoins and unlocking that potential. This diversification is an incredibly positive development for the long-term health and stability of the cryptocurrency market. It reduces dependence on one cryptocurrency and encourages creative innovation.

Historically, during the market cycle, BTC dominance peaks, indicating when altcoins will start to outperform. An unmistakable increase in altcoin dominance indicates that the overall cryptocurrency market has hit a bullish trend. This metric is one of the most telling signs that an alt season is starting.

Spotting the Signs of Altseason

Several indicators can help investors identify the potential start of an altcoin season:

  • Decline in Bitcoin dominance: As mentioned earlier, a decrease in Bitcoin dominance is a primary indicator of altcoin season.
  • Cooling-off period in Bitcoin's price: A period of consolidation or correction in Bitcoin's price often triggers altseason, as investors shift focus to altcoins in search of new opportunities.
  • Altcoin Season Index: The Altcoin Season Index is a tool that measures the performance of altcoins relative to Bitcoin. The altcoin season index hit 98 on April 16, 2021, indicating a strong altseason. Monitoring this index can help predict when an altcoin rally is likely to occur.

Every single Altseason in the past 10 years started immediately after a Bitcoin dominance drop. The alt season of 2020-2021 took place rent-free during the coronavirus pandemic. This created a perfect storm for retail investors and crypto enthusiasts alike to seek opportunities outside of Bitcoin. This altcoin flood happened right as the ICO market was hitting its peak in 2017-2018.

Navigating the Altcoin Landscape: Investment Strategies and Risk Management

Altcoin investing can be risky, so it’s important to have an established plan and a firm grasp of risk management fundamentals.

Whichever altcoin you choose, always do your due diligence before investing. That means having a strong grasp of your project’s basics — the tech, the team, the use case, the community. Finally, make sure to carefully examine the project’s tokenomics, their supply, distribution and utility on the platform, etc.

Diversification and Allocation: Balancing Risk and Reward

The best known, and probably the most important, principle of investing is diversification. Don’t throw good money after bad. Instead, diversify your investments among different assets to secure them more effectively. When you decide to invest in crypto, a rule of thumb is to put a decent chunk of your portfolio into Bitcoin. Then take another chunk and put that towards altcoins.

First, we know that many investors you’re working with prefer to put an even higher percentage of their portfolio into Bitcoin and Ethereum. These cryptocurrencies are generally considered safer investments than the riskier small altcoins. For instance, you can decide to put 60% of your crypto investments in Bitcoin and Ethereum and 40% in altcoins.

Risk Management: Protecting Your Capital

Here are some key risk management strategies to consider:

  • Allocate only a certain percentage of your investable wealth to crypto: It's important to remember that cryptocurrency investing is inherently risky. Never invest more than you can afford to lose. A common rule of thumb is to allocate no more than 5-10% of your investable wealth to crypto.
  • Use stop losses: A stop loss is an order to sell an asset when it reaches a certain price. This can help limit your potential losses in the event of a market downturn.
  • Take profits regularly: When your investments appreciate in value, it's wise to take profits regularly. This can help you lock in gains and reduce your exposure to risk.

Additional Tips

  • Stay informed: The cryptocurrency market is constantly evolving. Stay up-to-date on the latest news, trends, and developments.
  • Be patient: Cryptocurrency investing is a long-term game. Don't expect to get rich overnight.
  • Be skeptical: Be wary of hype and scams. Always do your own research before investing in any cryptocurrency.

Amahle Nkosi’s damaging analysis frames the elaborate web of causes and effects behind the hypocrisy fueling the cryptocurrency market. By better understanding these dynamics, you can invest wisely—and with confidence. Face the market with a smart, disciplined approach, and you just may find yourself reaping the rewards Bitcoin’s rise—and the expected altcoin breakout—have produced.