The long-awaited altcoin season is finally here, at least according to prominent crypto analytics firm CryptoQuant.
Altcoin season is when alternative cryptocurrencies (altcoins) experience substantial price increases and outperform Bitcoin. This is largely due to investors taking out their profits from Bitcoin and investing in these altcoins for more gains.
Since the crypto market kicked off its resurgence from the 2022 bear market, market participants have continued to anticipate this phase of the market to no avail. It is highly anticipated because altcoins tend to offer higher returns than Bitcoin in a bull market due to their smaller market caps that allow room for greater volatility.
Meanwhile, in an X post on Friday, February 21, CryptoQuant CEO Ki Young Ju asserted that this long-awaited phase of the market was finally here. However, he noted that the dynamics had changed.
Typically, altcoin season is marked by a decrease in Bitcoin’s market share dominance, implying a rotation of profits from Bitcoin to altcoins as speculators seek higher returns.
According to Young Ju, however, this is no longer the case. Instead of a rotation of capital from Bitcoin to altcoins, the market phase is now driven by direct stablecoin inflows.
Sharing the trading volume ratio of Bitcoin to altcoins on centralized exchanges, he noted that altcoin volumes were now almost thrice that of Bitcoin, suggesting stablecoin holders were now favoring altcoins.
“BTC Dominance no longer defines alt season—trading volume does,” the analyst stressed.
Ki Young Ju had theorized this shift in December 2024. He argued that with the emergence of Bitcoin proxies like exchange-traded funds and MicroStrategy, altcoins were being starved of fresh liquidity as capital could not rotate from these vehicles to other crypto assets.
“Bitcoin is drifting away from the crypto ecosystem. Altcoins used to move together based on their correlation with BTC, but that pattern has now broken,” he wrote at the time.
A Selective Altcoin Season
With this changing market dynamic, Young Ju has warned that only altcoins with paper-wrapped versions like ETFs or real internet money ecosystems supported by stablecoins or Bitcoin will survive.
“Find a coin that can do one of the two and hold it long-term,” he stressed.
Young Ju’s recent post comes as the crypto market appears to be staging a relief rally. At the time of writing, Bitcoin is trading just over the $99,000 mark, representing a 2% gain on the day. Meanwhile, most altcoins in the top ten by market cap like Ethereum, Solana, and Cardano are posting over 3% gains.
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