- Oversupply of altcoins may shorten future altcoin seasons, limiting prolonged rallies.
- Selecting profitable altcoins now requires more complexity, similar to stock picking.
- Utility-focused coins with clear use cases could thrive amid the evolving market dynamics
Analysts are debating whether the era of prolonged altcoin rallies is over. Historically, these periods saw altcoins outperform Bitcoin. The 2017-2018 cycle remains the most notable, with coins like Ether, XRP, and Litecoin reaching record highs.
Oversupply of Tokens Challenges Growth
Experts argue that the oversupply of tokens has disrupted the potential for extended altcoin seasons. Ali Martinez, crypto analyst, notes the dramatic increase in altcoins throughout recent years. The total number of cryptocurrencies available exploded from about 3,000 in 2017-2018 to surpass 36.4 million today.
Economist Alex Krüger believes this surplus of tokens exceeds market demand. He predicts that future altcoin seasons will be shorter. These brief surges may last only a few days to weeks, unlike the extended rallies of previous years.
Investor Challenges and Market Dynamics
The abundance of tokens has made investment decisions more challenging for traders. Krüger noted that selecting profitable altcoins now resembles the complexity of stock picking. This difficulty discourages retail investors and adds risk to portfolio management strategies.
Pseudonymous trader Ash Crypto criticized exchanges for focusing on memecoins and low-quality tokens. He stated that many exchanges prioritize volume over quality, causing retail investors to face losses. These issues have contributed to the dilution of the altcoin market.
Utility-Focused Coins Could Prevail
Despite challenges, some analysts believe certain altcoins may still thrive. Michaël van de Poppe predicts institutional interest in utility-driven coins will grow. He stated that coins with strong applications will stand out in the evolving market.
Ethereum could lead the next major rally, according to van de Poppe. He described Ethereum’s potential surge as the most hated rally of 2025. This outlook highlights the possibility of a more selective approach to altcoin investments.
A Changing Landscape
The altcoin market is shifting toward projects with clear use cases and narratives. Ki Young Ju, CEO of CryptoQuant, emphasized that only a few projects will succeed. This change reflects broader trends as investors focus on sustainable growth over speculation.
Bitcoin’s market cap has doubled since 2021, reaching $2.07 trillion. Meanwhile, the altcoin market remains below its 2024 peak of $1.9 trillion. These shifts suggest that altcoin seasons may become less prominent but still offer opportunities for strong projects.
