The End of the Mass Altseason Era: Analysts Predict a Shift in Market Dynamics

The upcoming altcoin season is expected to impact only a select portion of the market, with just a few projects outperforming Bitcoin in returns. This viewpoint is held by Timo Oinonen, a writer for CryptoQuant and on-chain analyst, who attributes this to market saturation and diminishing correlations among assets.

He noted a divergence between the performance of Bitcoin and TRX, which has shown enhanced returns since March, while its correlation with Bitcoin has weakened. Historically, such patterns have indicated a flow of capital and the initiation of an altcoin season.

However, the situation has shifted in the current cycle. The market is oversaturated with over 43 million tokens, which dilutes capital and hampers overall growth, even if Bitcoin’s dominance begins to wane.

The analyst predicts that investors will adopt a more selective approach. Instead of a broad market rally, only certain “premium” altcoins with robust fundamentals are likely to experience growth. Oinonen emphasized that a widespread altcoin season, similar to what was seen in 2017 and 2021, is unlikely to occur.

Another analyst known as LordOfAlts expressed that the altcoin season has not yet commenced, contrary to popular belief, as none of the 30 major indicators of a bullish market have been triggered.

He pointed out several factors supporting his thesis:

At the same time, he observed a growing interest in Ethereum, noting a liquidity shift into the ecosystem of the second-largest cryptocurrency by market capitalization. Activity in staking and layer two solutions is also on the rise.

LordOfAlts believes the market is still in its infancy. He advised investors to position themselves in anticipation of a rally that may take many by surprise.

As of this writing, the Altcoin Season Index stands at 48.

In the past week, Bitcoin’s dominance index fell from 63.76% to 60.78%, according to Glassnode.

This 2.98% decrease is among the sharpest seen this year, attributed to capital flowing from the leading cryptocurrency into altcoins.

However, trader dman_AG contends that the price of digital gold will continue to rise.

In his view, this suggests an influx of new capital into the market that will later return to the primary crypto asset.

The analyst also pointed out the formation of a “bull flag” pattern on the chart, asserting that the current situation resembles the consolidation period at the end of April. According to his forecast, the target for this figure is $140,000.

Trader Gaah highlighted the behavior of long-term Bitcoin holders. He mentioned that the SOPR indicator reached a peak for 2025, signaling increased profit-taking.

He noted that despite the rise, the indicator remains below levels historically associated with market cycle peaks, indicating that euphoria and widespread selling have yet to commence.

Historically, macro peaks have been signaled by SOPR levels above 4, while the current indicator value hovers around 2.5. The analyst believes this supports the notion of a potential continued price rise.

Such behavior suggests a bullish market, but not one that is nearing its end.

The trader cautioned investors to remain vigilant of trends while being mindful of the risks of substantial corrections.

Additionally, technical analysis advocate Peter Brandt has stated that the altcoin season has begun.