Altcoin Indexes Outperform Bitcoin, Small Caps Lead Market

Data shows all the altcoin indexes have outperformed Bitcoin during the past month, with the small caps becoming the market leaders.

According to the latest weekly report from Arcane Research, all indexes record positive returns in the 27-31% range during the past month. The “altcoin indexes” here refer to groups of alts divided based on their market caps. The benefit of creating indexes of cryptos is that it makes it easy to assess the performances of the different segments of the market against each other this way.

There are three main altcoin indexes: the “small caps,” the “mid caps,” and the “large caps.” As is already apparent from their names, each of these covers coins of different sizes.

Now, here is a chart that shows how these three indexes have performed against each other, as well as versus Bitcoin, over the past month:

As shown in the above graph, both the altcoins and Bitcoin observed very little price action in the final third of December, as their returns were close to 0%. This trend started to change around a couple of weeks ago, however, as some bullish price action finally returned to the market after what was a full year of mostly bearish movement in 2022.

In the period since then, the entire market has seen a significant uplift, as all the market segments are in some major profits now. The winner during the past 30 days has been the small caps, who are currently sitting at 31% in the green.

An interesting thing to notice is that the small caps suffered the most at the end of 2022 as they capped the year being noticeably more underwater than the other indexes (as can be seen in the chart). This makes them turning it around and outperforming the rest of the market all the more impressive.

Investors of both the large caps and mid caps are in profits of 28% each right now, not too far from the small caps’ performance. Bitcoin has also seen very close positive returns of 27% over the past month, but clearly, the altcoins have managed to outdo the pioneer crypto during this period.

As for Ethereum’s performance in this same period, the asset with the second largest market cap in the sector has observed gains of more than 32% in the past month, meaning that on its own, it has performed better than the indexes.

The report notes that the main reason behind the outperformance by the alts is due to these indexes observing a deeper decline than Bitcoin during the period following the FTX debacle back in November of last year.

At the time of writing, Bitcoin is trading around $21,200, up 21% in the last week.