Altcoin Season 2025: In the cryptocurrency market cycle, “alt season” refers to a significant period when alternative coins outperform Bitcoin in terms of price growth. During this period, these cryptocurrencies, including Ethereum (ETH), Solana (SOL), Cardano (ADA), and numerous other Layer 1 and Layer 2 tokens, typically experience a surge in trading volume, investor interest, and market capitalization. There is a reason for this phenomenon; it has to do with market psychology, liquidity rotation, and one crucial number: Bitcoin supremacy.
Bitcoin and Altcoins’ dominance refers to the percentage of Bitcoin’s market capitalization compared to the total market capitalization of all cryptocurrencies. This dominance has been around 55% to 54% since the middle of 2025, leading to more discussion about the onset of another cryptocurrency season. However, technical signs, past events, and an examination of capital movement all indicate that altcoins won’t truly shine again until Bitcoin’s dominance drops below 62% or lower.
Bitcoin Dominance and the Market Work
The Bitcoin dominance index is more than just a statistic; it reflects how investors perceive the entire crypto ecosystem. A strong Bitcoin dominance indicates that institutional and retail investors prefer Bitcoin because they believe it is stable and easily tradable. On the other hand, a drop in dominance usually means that people are feeling differently, and money is moving into altcoins that are more volatile but could pay out more.
Bitcoin’s market share fell from over 85% to less than 35% during the 2017 bull run. This led to a massive increase in other tokens, including Ethereum, Ripple (XRP), and Litecoin (LTC). The altcoin season of 2021 followed a similar trajectory. Bitcoin’s market share dropped below 40%, while DeFi tokens, meme coins, and Ethereum-based assets surged in value. These historical patterns strongly suggest that a decline in dominance precedes a surge in cryptocurrency, not follows it.
Why 62% is the Important Point
Benjamin Cowen, Michaël van de Poppe, and other top crypto researchers have said that 62% domination is a key psychological and technical milestone. The threshold is based on historical Fibonacci retracement levels on the Bitcoin dominance chart and lines up with important resistance areas. If Bitcoin’s dominance stays above this level, it means that most of the money coming in is going to Bitcoin, which keeps money from moving into altcoins.
Tools for technical analysis, such as TradingView’s Bitcoin Dominance Index (BTC.D), support this perspective. Whenever Bitcoin’s supremacy fails to remain above 62% for an extended period or falls back below it, altcoins tend to perform better. The way the chart looks in 2025 is very similar to how it looked in prior alt seasons, which makes this level a point of strong market interest.
What Will Start the Next Altcoin Season
If Bitcoin’s dominance drops below 62%, several macro and crypto-native factors are expected to converge in 2025, potentially helping to revive the altcoin season. For example, Ethereum Layer-2 networks, such as Arbitrum and Optimism, are experiencing growth, which is lowering transaction costs and attracting new developers. Projects like Celestia and Polygon are pushing for the use of zk-rollups and flexible blockchain architectures. This is also making it easier for decentralized apps (dApps) to grow.
Also, clear global rules are helping altcoins. The EU’s Markets in Crypto Prices Today: The Bitcoin-Assets (MiCA) framework and pro-crypto laws in places like the UAE and Hong Kong are making it easier for institutional investors to consider other cryptocurrencies beyond Bitcoin. Coinbase, Binance, and Kraken are adding support for altcoin staking, lending, and perpetual futures. This gives investors more opportunities to get involved.
At the same time, stories about Web3, GameFi, and decentralized AI are gaining more attention from the general public. Tokens that enable ecosystems like Render (RNDR), Fetch.ai (FET), and The Graph (GRT) are already showing signs of renewed interest, particularly among developers and venture investors.
What Ethereum Has to Do with the Altcoin Story
Ethereum remains a key player in any altcoin season. As the most popular innovative contract platform, its move to proof-of-stake and the introduction of proto-danksharding are making it far more scalable and efficient. EIP-4844 and other Ethereum Improvement Proposals (EIPs) are scheduled for release in 2025. This should make the network less congested and lower gas fees, making it easier to use DeFi protocols, NFTs, and DAOs.
The ETH/BTC ratio, which compares Ethereum’s market cap to Bitcoin’s, is another important measure. Historically, a growing ETH/BTC ratio has been associated with a broader altcoin rally. As this pair starts to make higher lows on weekly charts, it indicates that money is shifting away from Bitcoin and into ecosystems led by Ethereum. This is a sign that smaller altcoins will follow.
Why Bitcoin’s Dominance Is Going Down
Bitcoin’s dominance is declining due to several market forces. It has never been easier to diversify portfolios, as cryptocurrency infrastructure has matured, tokenomics have improved, and cross-chain bridges have become more prevalent. Bitcoin’s ecosystem is also not as extensive as that provided by intelligent contract networks.
Bitcoin Layer-2 solutions, such as Stacks and the Lightning Network, have improved things somewhat. However, they are still not as popular as the numerous developers working on projects like Solana, Avalanche, and Cosmos. Altcoins are naturally appealing to investors seeking opportunities to generate income, such as staking, liquidity mining, and participating in governance.
The flow of money is also influenced by what the media reports and how people perceive it. Reddit, YouTube, and X (previously Twitter) are examples of platforms that spread stories about popular altcoins. LunarCrush and Santiment are two tools that keep track of social volume and sentiment. They provide traders with real-time information that indicates altcoins are gaining popularity over Bitcoin during speculative periods.
Involvement of institutions and access to altcoins
The changing views of institutional investors on altcoins are one of the most significant developments to have occurred. Some cryptocurrencies, such as ETH and SOL, are being included in Grayscale’s diversified trusts, BlackRock’s crypto exchange-traded funds (ETFs), and Fidelity’s crypto custody services. Retail investors are following suit as these products become increasingly accessible on sites like Robinhood, eToro, and Webull.
Also, DeFi aggregators like Yearn. Finance and Convex are incorporating cryptocurrency into techniques that generate income. Aave and Compound are examples of liquidity protocols that currently handle a wide range of altcoins. This enables borrowing and lending across multiple chains. This increased accessibility, together with strong risk management solutions like Chainlink oracles, is making investors more confident in cryptocurrency ecosystems.
When to Look Forward to the Next Altcoin Season
It is well known that timing the market is challenging, but several signs suggest the possibility of an altcoin season in the second half of 2025. The overall market cap of altcoins is forming a rounded bottom, while Bitcoin’s dominance is going down. There is a bullish divergence in the RSI and MACD momentum indicators on several altcoin charts. This is frequently a sign that a rally is coming.
The Bitcoin halving that happened in April 2024 is also likely to have a delayed effect on capital rotation. In the past, altcoins have started to rise 6 to 12 months after a halving event. This is because Bitcoin’s price growth slows down, and investors hunt for the “next big thing.” The conditions seem right, with an increasing number of people becoming excited about decentralized AI, tokenized real-world assets (RWAs), and scalable Web3 applications.
