Real Altcoin Season Coming in 2025

Bitcoin crossing the $100,000 mark last week was undeniably a historic milestone. Yet as the leading cryptocurrency celebrated its achievement, many altcoins were already surpassing it, signaling the start of an altcoin season.

Since the start of the year, 20 of the top 50 cryptoassets by market capitalization have surpassed Bitcoin’s impressive 124% gain. Increasing altcoin market caps, growing media interest, and the Altcoin Season Index support this trend. Additionally, CCData’s recent report highlights that trading volume in November hit a yearly high and open interest reached all-time highs. This is the market that is showing signs of increasing risk appetite. This change generally benefits altcoins more, given their higher potential for outsized gains.

On a deeper level, investing in altcoins means investing in Web3 and other blockchain-related businesses. This industry, heavily dependent on regulatory clarity, is now more optimistic following the American elections. Additionally, recent data from CryptoQuant indicates that altcoin trading volume is not driven by BTC pairs. This implies real market growth rather than a rotation of assets from bitcoin to altcoins. This could also mean that this time the altcoin season will not wait for the bitcoin price to consolidate. We could see both types of cryptoassets rise.

The altcoin rally seen since November appears to be a prelude to a bigger altcoin season in 2025. New crypto trends and technologies will likely attract the attention of institutional investors and venture capital firms. Here’s what we can infer about the potential and key narratives of the upcoming altcoin season, based on on-chain data and other trends.

Altcoin season is about more than price

Altcoin season is generally defined as a period in which altcoins consistently outperform bitcoin. This phase often occurs during the final year of bitcoin’s four-year cycle, as market enthusiasm spills over from bitcoin to other coins. Large-cap altcoins are regaining or surpassing their previous all-time highs while emerging narratives are propelling mid- and small-cap coins to uncharted levels. This period culminates with widespread FOMO (fear of missing out), throwing the entire crypto market into a state of overheating. This then signals an impending correction and, possibly, the start of a bear market.

However, altcoin season is not just about prices. This represents a broader shift in market activity, adoption and innovation. Each altcoin season thus far has reflected unique technological and market changes.

The first altcoin season of 2017 was defined by the ICO boom and the emergence of NFTs (remember CryptoKitties?). The second altcoin season of 2021 combined the rise of DeFi with a real craze for NFTs and gaming. To enable these developments, cheaper and more scalable Layer 2 solutions have also emerged. All of these innovations have withstood the challenges of crypto winters and continue to grow.

Looking ahead, the third altcoin season of 2025 promises new narratives and technologies, some already in development and others to come.

Altcoin Season Indicators

Several indicators signal the start of the altcoin season. Bitcoin’s dominance is declining, altcoins are outperforming and their market capitalization is reaching new highs. Yet indices such as Altcoin Season and OTHERS suggest that the best is yet to come for altcoins.

In absolute terms, the altcoin market capitalization, calculated by subtracting the bitcoin capitalization from the total crypto market capitalization, has reached an all-time high. According to Coingecko, it now stands at $1.89 trillion, surpassing the previous high of $1.79 trillion in November 2021. In relative terms, bitcoin’s dominance has fallen from 60% to 51% since November.

However, both metrics include stablecoins and wrapped assets. Although essential for market liquidity, they do not necessarily reflect the true development of the altcoin market. Additionally, in bull market conditions, these assets tend to favor altcoins due to their higher risk-reward profile.

For a purer measure, the Blockchain Center’s Altcoin Season Index excludes stablecoins and wrapped coins. It defines altcoin season as occurring when more than 75% of the top 50 altcoins outperform Bitcoin over the past 90 days. Most recently, this index crossed the 75% mark on December 2 and held steady for a week. The previous altcoin season kept this index above the threshold for almost three months. This supports the idea that the real peak could occur in 2025.

The OTHERS Index calculated by platforms like TradingView is another key measure of altcoin performance. It tracks the total crypto cap excluding the top 10 coins (which include the two largest stablecoins). Despite a 123% increase in the last 30 days (before correction), this index has not yet reached its previous ATH. Last time around, it was up 525% from the 2017 ATH, suggesting substantial room for growth.

Finally, interest in altcoins is also reflected in Google Trends. With May 2021 being the peak month (indexed at 100), current search interest has increased to 87, the highest level since then.

Key Altcoin Stories for 2025

So far in 2024, the three best performing altcoins in the top 50 list have been memecoins: dogwifhat (WIF +2,027%), PEPE (+1,764%), and Dogecoin (DOGE +382%). However, even though memecoins are often emblematic of altcoin seasons, they are unlikely to define the overall crypto narratives of 2025.

According to data from the Blockchain Center, among the new technologies that emerged in 2023-2024, BRC-20 tokens performed the best. Although not considered by some to be true altcoins, these tokens issued on the Bitcoin blockchain using technologies like Ordinals or Runes have gained more than 1,000% since the start of the year. Among more conventional altcoin categories, RWA leads with 717% annual growth. These include tokenized versions of real-world assets and the protocols enabling their use. AI-related coins (+513%) and DePIN, or decentralized physical infrastructure (+303%), are following suit.

In 2025, new narratives are likely to emerge, and venture capital activity may indicate the most promising ones. According to Pitchbook, crypto VCs were quite moderate in 2023 ($10 billion) and 2024 ($7.1 billion in Q3). Next year, their business could rebound to at least the levels seen in 2021 and 2022, totaling $25.3 billion and $29.4 billion, respectively. This increase will be channeled into specific projects and broader categories that could define the next wave of growth.

Amid the excitement of altcoin season, it is crucial to avoid getting caught up in the hype. Each rise eventually ends in a correction, and only coins with strong fundamentals and real use cases will endure into the next cycle.