When does the altcoin season usually come? Analysis and summary of the exchange rate trends of 350 altcoins against BTC

background

Recently, BTC’s market capitalization has reached a two-year high, which prompted us to analyze the exchange rate of altcoins other than BTC against BTC. First, let’s observe the historical K-line trends of some mainstream coins against BTC.

Below is the exchange rate of some major currencies against BTC in TradingView over the past few years.

• LTC/BTC

• BCH/BTC

• ADA/BTC

• ETH/BTC

From the chart above, we can see that even the best performing tokens such as ETH only reached its historical highest exchange rate against BTC in 2017, about two years after its launch. Since then, the ETH/BTC exchange rate has not surpassed the previous high.

Therefore, we decided to expand the scope of our analysis: analyzing the historical exchange rate changes of all altcoins against BTC.

method

1. Select the top 500 coins by market cap from CoinMarketCap

2. Get the weekly price of these tokens from gate.io (gate has the longest historical price for most tokens)

3. Find out the highest exchange rates of all coins against BTC of all time and date

4. Calculate the date from the start of the transaction to the highest point of the BTC exchange rate

5. Calculate the time from the lowest point of the BTC exchange rate to the current date

6. Calculate today's exchange rate / all time high

7. This method has been open sourced on GitHub (there is a github link at the end of the article)

8. There is no complex statistics involved. In the future, we can adopt more statistical models for analysis.

Discover

The final range of tokens counted

Some of the top 500 tokens are not traded on Gate.io, and we excluded tokens with a trading time of < 1 year. Finally, we analyzed about 350 tokens, covering most of the mainstream tokens.

index

1. Exclude tokens with a transaction time of < 1 year

2. Calculate the exchange rate using the weekly high price comparison of altcoin and Bitcoin

When does the All-Time-High (ATH) of the token’s exchange rate against BTC usually occur?

• The Y-axis represents the time span (in years) since the token was launched to reach its all-time high price (ATH).

• The X-axis represents the number of years the token has been traded.

From the chart, we can find the distribution of ATH times.

1. Most of the tokens reached their ATH against BTC within the first year of trading

2. Few coins reach their ATH after 2 years

3. Let’s take a better look at this with a pie chart.

Chart: ATH distribution since trading start date

From the above chart, we can observe that:

1. Only 5.5% of tokens reached their ATH against BTC 2 years after launch, while the rest of the tokens reached their ATH within 2 years of trading start.

2. In order to better observe the results, we need to filter out tokens with a trading time of < 2 years.

3. Once we remove tokens with a transaction age < 2 years, we are left with approximately 289 tokens.

Chart: ATH distribution since inception date, excluding coins traded for more than 2 years

The results haven’t changed much, with only 6.6% of tokens reaching their ATH against BTC two years later.

Let’s dive into these tokens: ['BNB','DOGE','ETC','FIL','FRAX','FTM','GT','LEO','LINK','MANA','MATIC','OKB','ONE','TFUEL','THETA','TON','TUSD','VET','WAVES']

Of the 19 tokens, some may have been included by mistake due to Gate listing delays. The average transaction length is 4.82 years, which is 2019-01-09, when BTC was trading at around $3,500, the bottom of the last bear market.

When do altcoin All-Time-LOWs (ATL) usually occur?

In the previous section, we analyzed when the highest exchange rate of altcoins occurred. Now let’s explore when the historical lowest exchange rate of altcoins occurred.

index

1. Exclude tokens with a trading time < 1 year

2. Using weekly low values ​​of altcoins and Bitcoin to calculate exchange rates

This chart is even more interesting, it shows that the altcoin/BTC exchange rate ATL is almost linearly related to the transaction time, that is, the longer the transaction time, the greater the probability that the exchange rate against BTC is at ATL. Let's find out more through the pie chart!

Since ATL is more meaningful for tokens that have been traded for more than 4 years, we only include tokens that have been traded for more than 4 years.

Chart: Distribution of ATL for tokens traded for more than 4 years from the current date

Thus, only 18.4% of the coins that have been traded for more than 4 years have not reached the lowest point in the exchange rate with BTC in the last cycle. Let’s take a deeper look at these coins:

They are ['ADA','DASH','DOGE','ETH','GT','KNC','LINK','LTC','MANA','MKR','SNT','THETA','TRX','VET'] . These marked tokens mean that they are not worse than the previous cycle in terms of exchange rate against BTC. If we remove two special old tokens ETH and LTC, the average transaction length of the remaining tokens is 5.77 years, which was 2018-01-25 , which is the end of the last bear market, and the time difference between the coin issuance date and ATL is about 0.35, which sets their ATL at about 2018-06-05 .

in conclusion

1. Out of the 350 tokens we analyzed, only 19 have hit new all-time high prices against BTC in the last cycle.

1. They are: ['BNB','DOGE','ETC','FIL','FRAX','FTM','GT','LEO','LINK','MANA','MATIC','OKB','ONE','TFUEL','THETA','TON','TUSD','VET','WAVES']

2. They were listed around March 2019, the bottom of the last bear market

2. In the last cycle, only 14 tokens out of 350 have not created new ATL against BTC:

1. They are ['ADA','DASH','DOGE','ETH','GT','KNC','LINK','LTC','MANA','MKR','SNT','THETA','TRX','VET'] .

2. They were launched at the end of the last bull market and reached their all-time lows about 4 months later, at the start of the last bear market.

3. The only overlap is ['DOGE', 'GT', 'LINK', 'MANA', 'THETA', 'VET']

4. Therefore, bottom fishing is extremely risky and will most likely not bring the highest returns.

3. Try to avoid buying secondary market tokens that were listed during the last bull run!

1. Most of them will continue to set all-time lows

2. Some coins will see their all-time lows in BTC exchange rates for a few months before recovering in the next cycle. But these rebounds are rare.

4. Only tokens launched during a major bear market can create new ATHs against BTC, not even ETH

5. Try to sell all the tokens within 2 years after listing, and gradually convert them to BTC in the bear market, because only 6% of the tokens can create a new ATH against BTC in the next cycle, which is stronger than the previous cycle.