Crypto course · Section 3: Reading the Market
Crypto Market Cycles: Halving, Bitcoin Dominance and Altcoin Season
How the Bitcoin halving, market cycle phases, Bitcoin dominance and the altcoin season index fit together, and why past cycles are no guarantee.
Intermediate6 min read·6:11 video·Lesson 9 of 26·quiz: 4 questions
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Crypto has moved in boom-and-bust cycles that have roughly lined up with Bitcoin's halving, the cut in new Bitcoin supply that happens about every four years. In past cycles Bitcoin rose first, money then rotated into altcoins near the top in an "alt season", and a deep bear market followed. Bitcoin dominance and the altcoin season index help you see which phase the market is in, but with only a handful of cycles in the data, no pattern is guaranteed to repeat.
The halving
Bitcoin pays newly created coins to the miner of each block. Every 210,000 blocks, about four years, that reward is cut in half.
| Halving | Date | Reward per block |
|---|---|---|
| First | November 2012 | 50 to 25 BTC |
| Second | July 2016 | 25 to 12.5 BTC |
| Third | May 2020 | 12.5 to 6.25 BTC |
| Fourth | April 2024 | 6.25 to 3.125 BTC |
| Fifth | Expected around 2028 | 3.125 to 1.5625 BTC |
Example
About 144 blocks are mined per day (24 hours x 6 blocks per hour). Before April 2024: 144 x 6.25 = about 900 new BTC per day. After: 144 x 3.125 = about 450 BTC per day. If demand stays the same while new supply halves, there is less fresh selling from miners, which is the simple argument for why halvings have been followed by rallies.
The halving is known years in advance, so part of its effect may already be in the price. Each halving is also smaller in relative terms, because new supply is an ever-smaller share of the coins already in existence.
The four phases of a cycle
Analysts usually describe four phases:
- Accumulation: after a crash, prices move sideways at low levels, interest is low and long-term buyers collect coins.
- Markup: a trend begins, Bitcoin breaks previous highs and media attention returns.
- Distribution: prices are high and volatile, altcoins and meme coins surge, leverage and funding rates are elevated, and early holders sell to newcomers.
- Markdown: a bear market. Prices fall step by step, rallies fail and many altcoins lose most of their value.
In past cycles, Bitcoin peaked in December 2017 and November 2021, roughly 17 to 18 months after the 2016 and 2020 halvings. The bear markets that followed, in 2018 and 2022, took Bitcoin down by roughly 75% to 85% from its peak.
Risk
That is two or three data points, not a law. The 2024 cycle already broke the pattern: helped by demand from the new US spot Bitcoin ETFs, Bitcoin made a new all-time high in March 2024, before the halving, for the first time. Institutions, ETFs, interest rates and regulation now matter more than they did in 2013 or 2017. Treat "the cycle" as context, not a calendar.
Bitcoin dominance
Bitcoin dominance (often written BTC.D) is Bitcoin's market value as a share of the whole crypto market.
Example
Bitcoin's market value is $1.5 trillion and the total crypto market is $2.5 trillion. Dominance = 1.5 / 2.5 = 60%. If altcoins rally and the total rises to $3.0 trillion while Bitcoin stays at $1.5 trillion, dominance falls to 50%.
Read dominance together with Bitcoin's own price:
| Bitcoin price | Dominance | What it often means |
|---|---|---|
| Rising | Rising | Bitcoin leads; altcoins lag. Common early in a bull phase |
| Flat or rising | Falling | Altcoins outperform; rotation into alts |
| Falling | Rising | Risk-off; altcoins fall harder than Bitcoin |
| Falling | Falling | Broad sell-off, sometimes with money parked in stablecoins |
One caution: stablecoins are part of the total market value. When traders sell coins into stablecoins, the stablecoin share rises and dominance can move for reasons that have nothing to do with altcoins. You can follow the live chart and its 90-day trend on the Bitcoin dominance page.
Altcoin season
Altcoin season is a period when most altcoins beat Bitcoin. The common way to measure it is the altcoin season index: the percentage of the top altcoins (excluding stablecoins) that performed better than Bitcoin over the last 90 days.
- 75 or more: alt season. Three in four top altcoins are beating Bitcoin.
- 25 or less: Bitcoin season. Most altcoins are losing to Bitcoin.
- In between: mixed.
Example
Out of 50 tracked altcoins, 40 beat Bitcoin over 90 days. The index reads 40 / 50 = 80, which is alt season. A month later only 20 are ahead: 40, a mixed market.
The altcoin season index on DanioX shows this live alongside dominance and the ETH/BTC ratio, which often rises when appetite for altcoins grows. Alt seasons have historically been short and arrived late in a bull phase, so a high reading is also a reminder that the market may be stretched. For the wider macro picture, the Learn guides explain how the dollar and gold link to crypto seasons, and Methodology shows exactly how DanioX scores each season.
Using cycles without fortune-telling
Cycle awareness is most useful for risk, not prediction:
- Size down late in strong rallies. When funding is high, alt season is running and everyone is euphoric, smaller positions protect you from the markdown.
- Use a regime filter. A simple, testable rule, such as only taking long trades while Bitcoin is above its 200-day moving average, keeps you out of most bear-market grind. The Regime Trend setup on DanioX is a live example of a strategy that switches off when Bitcoin is below that average.
- Do not short a halving or buy a calendar date. Prices respond to supply, demand, liquidity and news, not to the day of the month.
Tip
Write down which phase you think the market is in today, and why, using dominance, the season index and Bitcoin's trend. Revisit your note in three months. This trains you to judge context honestly instead of remembering only the calls you got right.
Next, learn to map the price chart itself in Support, Resistance, Trend and Volume.
Key takeaways
- The halving cuts Bitcoin's new supply in half about every four years; the reward has been 3.125 BTC per block since April 2024.
- Past cycles followed a rough pattern: Bitcoin leads, altcoins catch up near the top, then a bear market of roughly 75-85% for Bitcoin.
- Bitcoin dominance is Bitcoin's share of total crypto market value; falling dominance while Bitcoin holds up often marks altcoin strength.
- An altcoin season index of 75 or more means most top altcoins beat Bitcoin over 90 days.
- Only a handful of cycles exist and the market has changed, so use cycles for context and risk, never as a timetable.
Quiz: check what you learned
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⚠ Not financial advice — educational signals only. Read the disclaimer.