Seasoned analyst Darkfost reports that altcoins remain in a precarious market position, especially following recent global financial losses. For context, over $1 trillion was wiped out of US financial markets on Friday due to weak sentiment around AI and semiconductor stocks. The widespread decline encompassed losses of 2.6% in the S&P 500, 4.7% in the Nasdaq, and 4% in Bitcoin.
Two Years On, Altcoins Continue To Underperform The Market
For altcoins, the rust runs deeper, as this set of cryptocurrencies has consistently struggled to appreciate since December 2024, showing little correlation with Bitcoin in the current cycle. According to Darkfost, the recent decline indicates that 83% of these alternatives to Bitcoin are trading below their 200-day moving average (200DMA), a key long-term indicator of price growth.
This suggests that investor sentiment towards altcoins is strongly bearish, as capital continues to concentrate in Bitcoin. The analyst further notes that the current reading ranks among the weakest of the present market cycle. Since 2002, the share of altcoins trading below the 200DMA has largely remained within the 60%–90% range. This suggests a structural market weakness, driving high underperformance across this market segment.
For context, 200DMA represents the average closing price of an asset over the previous 200 trading days. It functions as a dynamic support or resistance level, and is a key measure of overall market health.
Altcoin Woes Translate To $520 Billion Loss
According to additional data shared by Darkfost, the altcoin troubles have also led to a significant loss of market value. The analyst notes that the TOTAL3 chart from Tradingview, which tracks the combined market capitalization of altcoins excluding Ethereum, has shed nearly $520 billion from its peak in October 2025, falling to approximately $670 billion.
This decline has effectively erased months of gains across the broader altcoin market, with TOTAL3 returning to valuation levels last seen in November 2024. The sharp contraction underscores the extent of capital flight from alternative cryptocurrencies as investors increasingly favor Bitcoin amid ongoing market uncertainty.
However, Darkfost argues that periods of extreme pessimism have historically offered some of the most attractive opportunities for long-term investors. In contrast, periods when nearly 90% of altcoins traded above their 200-day moving average—such as in March and December 2024—often coincided with heightened optimism and reduced upside potential.
The analyst also highlighted that the breadth expansion recorded during those periods was the strongest seen since 2017, reflecting an unusually broad participation across the altcoin market.
Featured image from Pi42, chart from Tradingview
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