Felix Hartmann, managing partner at Hartmann Capital, stated, “Altcoin season seems to have peaked for now.” He added that teams and venture capitalists are starting to close positions more aggressively, saying, “When momentum tips, we’ll see major downward spikes (murder wicks) on the charts.”

Overleveraged Altcoins

Hartmann explained that many altcoin funding rates have now surpassed 100% annualized, with recent price moves driven largely by perpetual traders amid declining spot market volumes. He warned, “The leg down will be brutal.”

According to CoinMarketCap data, the top-performing altcoins since November 1 include:

• Hedera (HBAR): up 99.31%,
• IOTA: up 79.61%,
• JasmyCoin (JASMY): up 72.47%.

However, historical data shows that altcoin seasons often lead to sharp corrections after significant gains. For example, in November 2021, Solana (SOL) reached $248.36 but dropped 64% to $89 by January 2022. Similarly, XRP saw a 51% decline in the same period.

Diverging Opinions

Some traders believe that the altcoin season has only just begun. Pseudonymous trader MilkyBull Crypto stated, “This month through March seems logical.” Another trader, Sensei, said, “Altseason has just started.”

For many investors, Bitcoin dominance serves as a key indicator of the start of an altcoin season. Currently, Bitcoin’s market dominance stands at 55.11%, down 7.88% over the past 30 days, according to TradingView data.

On December 4, Cointelegraph reported that the funding rates for perpetual futures have risen significantly, with bulls paying between 4% and 6% monthly to maintain leveraged positions. While these costs may seem manageable during strong uptrends, they can quickly erode traders’ margins if prices stagnate or dip.

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