The crypto market continues to buzz with speculation about the next big move—will it be a surge in altcoins or another Bitcoin-dominated rally? Despite growing optimism, a true altcoin season has not yet materialized. Prominent market analyst Benjamin Cowen recently explained why in a detailed analysis, shedding light on the structural and macroeconomic factors holding back a broader altcoin rally.
Historically, an altcoin season is defined by a sustained period in which altcoins outperform Bitcoin—not just in U.S. dollar terms, but also when measured against BTC itself. This typically happens after a significant decline in Bitcoin dominance, signaling a rotation of capital from Bitcoin into alternative cryptocurrencies. However, in the current market cycle, that shift hasn’t occurred.
A Pattern Repeating—But Slower
Looking back at previous bull runs, clear patterns emerge. In both 2017 and late 2020 to early 2021, altcoin seasons followed a sharp drop in Bitcoin’s market dominance. What’s more, a key metric tracked by analysts—the ratio of total altcoin market cap (excluding Bitcoin and stablecoins) to Bitcoin’s market cap—fell to around 0.25 before altcoins began their explosive rallies.
Today, that same ratio sits at approximately 0.31, suggesting altcoins are still relatively overvalued compared to Bitcoin. This implies the market hasn’t yet reached the necessary “capitulation” phase where investors rotate out of BTC and into alts.
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In other words, while sentiment may be improving, the technical conditions for a full-blown alt season aren’t in place yet. Many altcoins remain far above their historical BTC-denominated support levels, leaving room for further downside before a sustainable rally can begin.
The Role of Federal Reserve Policy
One often overlooked but critical factor is macroeconomic policy, particularly actions by the U.S. Federal Reserve. In past cycles, alt seasons gained momentum after the Fed announced rate cuts or concluded quantitative tightening (QT). These moves increase liquidity in financial markets, encouraging investors to take on more risk—exactly the environment altcoins thrive in.
However, in 2025, the Fed has been cautious. While the pace of QT has slowed, it hasn’t fully ended, and rate cuts have been limited. As a result, market liquidity remains tight, and risk appetite is subdued. Investors are favoring perceived safe-haven assets within crypto—primarily Bitcoin—over more speculative altcoins.
This liquidity crunch explains why even as Bitcoin hits new all-time highs, many altcoins continue to lag or decline. Without a clearer shift toward accommodative monetary policy, it’s unlikely that capital will rotate into higher-risk digital assets at scale.
Bitcoin’s Strength Is Holding Back Alts
Bitcoin’s ongoing strength is another key reason altcoin season hasn’t kicked in. While some short-term rallies have occurred in select altcoins—driven by narratives like AI, DeFi, or memecoins—the broader market remains weak. Many top altcoins are still trading well below their 2025 highs, both in USD and especially when priced in BTC.
For example, Ethereum, Solana, and Cardano have seen limited momentum despite strong fundamentals and ecosystem growth. This suggests that market sentiment is still risk-averse, and capital is not flowing freely into alternative projects.
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The data shows a consistent pattern: alt seasons don’t begin when Bitcoin is rising strongly. Instead, they follow periods where Bitcoin consolidates or pauses after a major run-up—freeing up capital for speculation elsewhere in the market.
When Could Alt Season Start?
Based on historical trends, analysts project that the necessary conditions for alt season could develop by late September to November 2025. This timeline aligns with potential Fed policy shifts—possibly including rate cuts—and the typical lag between Bitcoin’s peak dominance and the start of altcoin outperformance.
Additionally, on-chain metrics and investor behavior suggest that many traders are still holding onto hopes of quick gains without the patience for strategic positioning. True market bottoms often form when sentiment turns pessimistic and speculative fervor cools—a sign we’re not quite at yet.
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That said, once Bitcoin dominance begins to meaningfully decline and macro conditions improve, the pent-up demand for altcoins could trigger a rapid and widespread rally. Early movers who position wisely during this consolidation phase may stand to benefit the most.
Frequently Asked Questions (FAQs)
What defines an altcoin season in crypto?
An altcoin season occurs when alternative cryptocurrencies consistently outperform Bitcoin in both USD value and BTC-denominated price. It usually follows a drop in Bitcoin’s market dominance and increased risk appetite in the broader market.
Why haven’t altcoins rallied yet despite Bitcoin’s high price?
Even with Bitcoin reaching new highs, altcoins need more than just a strong BTC price—they require declining dominance and improved liquidity. Currently, tight monetary policy and strong BTC performance are keeping capital concentrated in Bitcoin.
Do all altcoins rise during alt season?
While many altcoins participate in a broad rally, not all perform equally. Projects with strong fundamentals, active development, and real-world use cases tend to outperform speculative or low-liquidity tokens.
Can altcoin season happen if Bitcoin keeps rising?
Yes—but only if altcoins rise faster. During alt seasons, Bitcoin may continue to climb, but its relative gains are smaller. The key indicator is Bitcoin dominance falling, signaling capital rotation into alts.
How can I prepare for the next altcoin season?
Focus on research: identify high-potential projects early, monitor Bitcoin dominance trends, and watch macroeconomic signals like Fed policy. Diversify strategically, but avoid overexposure during uncertain phases.
Is it too late to invest if alt season is delayed?
Not at all. Delays can create better entry points. Use this time to study market cycles, build watchlists, and strengthen your strategy before the next wave of momentum begins.
The current crypto landscape may feel stagnant for altcoin enthusiasts, but history suggests patience pays off. With the right macro conditions and technical setup on the horizon, the foundation for the next major altcoin surge could be forming quietly beneath the surface.