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- Zafar Naik
Zafar Naik
- Feb 06, 2025 06:24 UTC
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Why Is Altcoin Season Delayed Again? Ethereum Could Be to Blame
Capital is flowing into stablecoins, not altcoins, due to market uncertainty and Ethereum's weak performance.
Tether and USDC supplies have significantly increased, indicating a risk-off approach by investors.
Ethereum's underperformance is hindering altcoin growth, as it has historically acted as a catalyst for altcoin seasons.
The much-anticipated altcoin season still feels like a distant dream, and many crypto enthusiasts are left wondering: when will it finally arrive? Altcoin seasons typically kick off when investors start shifting capital from Bitcoin into top altcoins like Ethereum (ETH), sparking widespread market rallies. But right now, the signs are pointing in a different direction.
Ethereum’s underperformance and a sudden shift in market dynamics have left altcoins struggling. Could this be a sign of a longer wait?
Keep reading to find out why the altcoin season is on hold, and what could finally trigger the next rally.
Funds Move to Stablecoins, Not Altcoins
Crypto analyst Ali Martinez has pointed out a major shift in the market: instead of flowing into altcoins, capital is now moving into stablecoins. This suggests that investors are playing it safe and avoiding the higher risk of altcoins due to ongoing market uncertainty.
As a result, altcoins are struggling to gain any meaningful momentum.
Why Are Stablecoins on the Rise?
Since Donald Trump’s election win, the supply of stablecoins has surged. Tether’s (USDT) supply has increased by $20 billion, reaching $140 billion. Meanwhile, USD Coin (USDC) has grown by $17 billion to reach $52 billion. Tether has also become the third-largest buyer of U.S. Treasuries, investing a huge $113 billion in 2024 alone.
With the growth of stablecoin adoption, we could soon see more liquidity flow back into the crypto market. Additionally, crypto czar David Sacks has emphasized that stablecoins are becoming a key part of the U.S. economy. With a $227 billion market cap, stablecoins are expected to keep growing in the months ahead.
Ethereum’s Downward Slide
Ethereum has historically been the spark that ignites altcoin seasons. In previous bull runs, ETH led the way, bringing attention and capital to the broader altcoin market. But right now, Ethereum is struggling. Its price has remained flat, and traders are now focusing on other Layer 1 projects and speculative tokens instead.
Crypto trader Picolas Cage pointed out that altcoins won’t recover unless Ethereum sees a rebound. In past bull markets, ETH led trends like ICOs, DeFi Summer, and the NFT boom. Without a similar growth driver now, altcoins are stuck in a holding pattern.
When Will Altseason Return?
Global events have also played a role in slowing down the crypto market. A recent flash crash triggered by new tariffs from Donald Trump 
Donald Trump
Donald J. Trump is a US-based business tycoon, pro-crypto politician, and 47th (present) President of the United States. He comprehends the significance and needs of the modern fintech world, and people look up to him as a dominant pro-crypto politician.
Once doubtful about Bitcoin's dominance, he said in a tweet in 2019, “I am not a fan of Bitcoin", but now has a significant amount of cryptocurrency holdings in his pool. He has also signed an Executive Order to establish a Strategic Bitcoin Reserve, which highlights his commitment to the future of cryptocurrency.
Quick Facts
Full name Donald John Trump Birth 14-06-1946, New York, United States Nationality American Education BS from the University of Pennsylvania Famous For Business, Politics
Donald Trump - Career Highlights & Events
2016 – Elected as the 45th President of the United States from the Republican Party. 2017 – Signed the Tax Cuts and Jobs Act, impacting investment environments 2019 – Slammed crypto king Bitcoin on X, calls it "not money". 2025 – A gala party was hosted by him for the top 220 Trump meme coin holders. President 
led to a massive sell-off in stocks, commodities, and crypto. Altcoins were hit hardest, with the total market cap falling from $1.46 trillion at the end of January to $1 trillion by February 3 – wiping out $460 billion in value.
According to crypto analyst Rekt Capital, Bitcoin’s market dominance must exceed 70% before an altcoin season can begin.
While Bitcoin’s dominance is rising, it’s still not high enough. In past altcoin seasons, the shift has started once Bitcoin dominance hits 71%, followed by a pullback. Until then, the market remains in a holding pattern, with altcoins waiting for their moment to shine.
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The market may be quiet now, but when the tides shift, the next altcoin season could be just around the corner.
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