Altcoin investors may end 2025 without profit in their portfolio. Still, many analysts remain optimistic, despite the altcoin market capitalization (TOTAL2) being 30% lower than this year's peak.
Why do analysts think the altcoin bear market is entering its final phase? The points below outline the main reasons.
Why altcoins are in a chance phase
Firstly, CryptoQuant data shows that only about 3% of altcoins on Binance are trading above the 200-day moving average. This level is a historical low.
CryptoQuant analyst Darkfost particularly cites the lack of liquidity and the defensive sentiment of investors as the main causes. Investors are currently focused on preserving their capital rather than exposure to risky assets.
The fact that most altcoins are trading well below their long-term averages shows a broad undervaluation due to negative sentiment. Recent BeInCrypto analyses indicate that altcoins like XRP, TON, and ADA have strong fundamentals, but their prices are still not recovering.
Despite the gloomy outlook, historical comparisons suggest that such weak periods often provide interesting buying opportunities for patient investors.
“Although it may not seem logical, such periods often provide the best opportunities. This phase may still last some time, especially if the market remains in a bear phase for longer,” said Darkfost.
Secondly, fear and a lack of interest from retail investors often open the best buying zones. Large investors seize these moments to accumulate.
Well-known X-analyst CrediBULL Crypto calls this an important signal to recognize a market bottom. In a recent post, he stated that first the attention shifts, then the capital.
When retail investors drop out, large parties step in. With the first green candles, retail attention slowly returns. This participation then accelerates the next phase of the movement.
Technical signals indicate a possible bottom.
Thirdly, multiple technical indicators suggest that the altcoin bear market is nearing its end. Well-known market analyst Michaël van de Poppe states that the current level of altcoin market capitalization acts as strong support. He calls this zone an “area to hold.”
“Ultimately, we seem to be at a crucial support level. It seems wise to stay at this level. Strong rebounds suggest that green candles may emerge from here,” predicted Michaël van de Poppe.
Additional signals reinforce this expectation:
The ratio of altcoin market capitalization excluding the top 10 (versus Bitcoin) is at its strongest support level since 2017.
Altcoin dominance is now at similar levels as during the COVID crisis, which preceded a strong recovery.
These factors indicate that altcoins may be in their final phase of decline. Recent BeInCrypto analysis suggests that a DCA strategy could be effective if started in December.
Some analysts warn of risks. They say that an altcoin season might not even arrive in 2026. The inflow of venture capital remains weak, and market sentiment may take a long time to recover.
