Altcoin Season May Be Over

🚨 Is Altcoin Season a Dinosaur? 🦖

Oh dear, oh dear! It seems the crypto world has gone utterly bonkers! Bitcoin (BTC) dominance, a measure of Bitcoin’s overall share of the crypto market, has been steadily rising since 2023 like a phoenix from the ashes, while a plethora of new cryptocurrency coins and tokens have been popping up like mushrooms after a spring rain.

The current BTC market dominance is roughly 61.6%, down from the local peak of 64.3% recorded on Feb. 3. Now, you might be thinking, “But what about all those poor altcoins?” Ah, yes, well, they’re not exactly thriving, are they? 😔

BTC market dominance broke back above 60% on Feb. 2, just as the market was having a good old-fashioned wobble over fears of a prolonged trade war between the United States and its trading partners. Macroeconomic uncertainty, you see, tends to make risk-on assets go all wobbly, and the recent market downturn hit altcoins particularly hard, what with their lower liquidity and higher-risk profiles.

And to make matters worse, those pesky Bitcoin exchange-traded funds (ETFs) have come along, siloing liquidity into these financial instruments, leaving altcoins to wither and die on the vine. It’s like a big game of musical chairs, but instead of chairs, it’s altcoins, and instead of music, it’s the sound of investors running for the exits! 🚪

Now, in previous cycles, investors would rotate their profits from less-risky assets like BTC into progressively higher-risk investments, starting with high-market-cap altcoins and eventually working their way down to those tiny, tiny tokens that are just begging to be invested in. But not this time, no sir! The liquidity is all tied up in those ETFs, and the proliferation of new coins and tokens has made it a veritable feast of choice for investors, leaving altcoins to wither away like last week’s leftovers! 🤢

Too many tokens have saturated the market

And to add insult to injury, the total number of cryptocurrency tokens and coins listed on CoinMarketCap has gone from under 11 million unique assets on Feb. 8 to over 12.7 million as of March 15! It’s like a never-ending parade of new coins, each one more ridiculous than the last! 🎉

Over 600,000 tokens were launched in January 2025 alone, and the vast majority of these assets were memecoins created on fair launch platforms and low-cap altcoins. And let’s be real, folks, most of these coins are just going to end up as doorstops, permanently trapping capital inside illiquid pools. It’s a veritable graveyard of failed altcoins! 🌳

But, as market analyst Jesse Myers so aptly put it, “When these coins fail, they don’t go to $0. Instead, they linger around market capitalizations of $10,000 to $100,000 — permanently trapping capital inside illiquid pools.” Ouch, that’s a bit of a kick in the teeth, isn’t it? 😩

And to top it all off, Coinbase CEO Brian Armstrong has had to reevaluate the exchange’s token listing process to meet consumer demand. It’s like they’re trying to put out a fire with a bucket of gasoline! 🚒

2025-03-17 20:12

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