The wait for the much-awaited altcoin season — when alternative cryptocurrencies outperform Bitcoin for a period in the market seems to be unending.
Historically, as Bitcoin’s dominance in the market wanes, investors rotate capital into alternative cryptocurrencies like Ethereum marking widespread price rallies in non-BTC currencies. This was most notable in 2017-18 where altcoins witnessed explosive growth
Here is what is causing the delay on the onset of the latest alt season:
Bitcoin Dominance Continues:
Bitcoin Dominance Index (BTC.D), which tracks BTC’s market cap versus the rest of the crypto market, has risen by over 15.5% in January 2025, and is up 55% in the past three years.
Despite falling below the $100k psychological price point, several factors continue to drive Bitcoin’s dominance in the market.
For one, the successful launch of spot Bitcoin ETFs which reported total net flows of $40.5 billion at the end of January have shown an increasing involvement of institutional investors.
Crypto President Trump’s election to the top US office has strengthened Bitcoin’s market position as investors expect a favorable regulatory environment. Several US senators have openly supported Bitcoin and US states like Wyoming, Arizona and North Dakota are expected to divert public funds towards Bitcoin.
Recognizing Bitcoin as a strategic asset, Trump has also directed the Policy Working Group to explore the possibility of creating a national Bitcoin stockpile, driving the currency’s dominance.
These signs, according to Sam Wouters, is a sign of a broader decoupling between crypto and Bitcoin markets. The River Financial executive argues that the times of altcoins outperforming BTC during speculative altseasons are over.
Ethereum Struggles, Funds Moving to Stablecoins:
While ETH has usually led the way to an alt season via events like ICO booms, DeFi summers, and the rise of NFTs, the number two crypto is currently struggling. It has lost almost 20% of its value in just the last week. XRP is down over 18% and Solana by over 13%.
Even the recent threat of a trade war when Trump announced tariffs against Mexico, Canada and China, hit altcoins the most.
According to Crypto analyst Ali Martinez, capital in the crypto market that is not flowing to Bitcoin, is not flowing to altcoins but to stablecoins like Tether (USDT) and USD Coin (USDC).
Too many tokens – greater supply than demand
“Today, there are over 36.4 million altcoins, compared to fewer than 3,000 during the 2017-2018 alt season and even fewer than 500 altcoins in 2013-2014,” Martinez added, explaining the delay in the alt season.
The massive supply may changed the market significantly, making it unlikely to see a long alt season where everything goes up for an extended period of time. However, if Bitcoin’s price stabilizes and Ethereum rebounds, the future may still hold promise.
