Altcoin Season Takes an Unusual Turn as Stablecoins Fuel Market Gains

A New Kind of Altcoin Season

CryptoQuant CEO Ki Young Ju has announced the arrival of altcoin season. However, unlike past cycles where Bitcoin dominance gives way to a broad altcoin rally, this time, stablecoins are at the center of the action.

Rather than capital rotating from Bitcoin into altcoins, Ju highlights that stablecoin holders are driving the latest price surges. With overall market liquidity still limited, this shift has made the rally highly selective—only a few altcoins are experiencing significant gains.

Altcoin Trading Volumes Surpass Bitcoin

Ju has observed a dramatic increase in altcoin trading activity, with volumes now exceeding Bitcoin’s by more than 2.5 times. Despite this, he insists that the current trend is not a typical altcoin season. Instead, he likens the market dynamic to a "PvP fight," where only a few fortunate tokens are attracting interest while many others remain stagnant.

This shift aligns with Ju’s earlier market predictions, where he warned that this cycle would be more challenging. Instead of a broad market upswing, only select assets are likely to see substantial growth.

Divided Opinions on the Altcoin Rally

Not all investors share Ju’s view. Some crypto traders, like RobW, question whether the term "altcoin season" applies when only a handful of tokens are performing well. Others, such as DeimosWeb3, argue that the market is far from a full-scale altcoin rally and remains fragmented.

Skepticism about the sustainability of this rally raises concerns about whether the current uptrend is temporary or signals a new market structure.

Is China’s Economic Policy a Game Changer for Crypto?

Another factor generating buzz in the crypto space is China’s recent fiscal policy adjustments. Some speculate that these changes could introduce fresh liquidity into global markets, potentially benefiting cryptocurrencies.

However, analysts remain cautious. While China has modified its M1 money supply, these adjustments do not necessarily inject new capital into the system. Despite this, some traders remain hopeful, believing that even indirect liquidity boosts could trigger a wider crypto market rally.

Select Altcoins Show Promise Amid Market Uncertainty

Despite a cautious market outlook, a few altcoins are gaining momentum. Tokens such as Sei, Sui, and Zksync have seen notable price increases, signaling emerging trends. However, it remains unclear whether these gains are sustainable or merely short-lived spikes in an unpredictable market.

The traditional altcoin season, where capital rotates from Bitcoin into a broad range of alternative coins, appears to be evolving. Instead, altcoins are beginning to attract capital independently, carving out unique narratives that could shape the next phase of the cryptocurrency market.

FAQ

Here are the headings with numbering added:

1. What is altcoin season?

Altcoin season refers to a period in the crypto market when alternative cryptocurrencies (altcoins) outperform Bitcoin, often seeing rapid price increases due to capital rotation.

2. How are stablecoins influencing the current altcoin season?

Unlike previous cycles where Bitcoin dominance declines, stablecoins are driving the latest altcoin gains. Investors are using stablecoins to buy select altcoins, making this rally more selective.

3. Why are only a few altcoins seeing gains?

With limited liquidity in the market, only a handful of altcoins are attracting significant investment. This makes the rally highly fragmented, unlike traditional altcoin seasons where most altcoins surge together.

4. Could China’s economic policies impact crypto?

Some traders believe China’s fiscal adjustments could introduce fresh liquidity into global markets, potentially benefiting crypto. However, analysts argue that the changes in China’s M1 money supply do not directly add new capital.

5. Which altcoins are gaining traction?

Altcoins like Sei, Sui, and Zksync have seen strong price performance, but it remains uncertain whether these gains will be sustained in the long run.