Altcoin season 2025 appears to be gaining traction as investors shift focus away from Bitcoin, according to the latest analysis from leading US crypto exchange Coinbase. The digital asset marketplace anticipates a constructive outlook for the third quarter, with clear signals pointing to an intensified rotation into altcoins as September approaches.
Altcoin Season 2025: Key Market Shifts
Coinbase’s research highlights a notable decline in Bitcoin’s market dominance, which dropped from 65% in May 2025 to 59% by August. This decline is a strong indicator of increasing capital flow into altcoins, reinforcing the early stages of altcoin season 2025.
Although the widely watched Altcoin Season Index remains in the low 40s—below the 75 level that typically defines a classic altcoin season—the total altcoin market capitalization has soared by more than 50% since July, reaching $1.4 trillion by mid-August. This surge suggests a potential move toward a deeper and more widespread altcoin season 2025 as Q3 progresses.
Improving Liquidity and Market Participation
Coinbase notes a significant improvement in liquidity metrics for altcoins. Enhanced order book depth, increased spot and perpetual volumes, and reduced slippage are all making it easier for investors to participate in altcoin trading without triggering large price swings. These factors collectively support the growing momentum behind altcoin season 2025.
Institutional Demand and Altcoin Season Divergence
The divergence between the Altcoin Season Index and altcoin market cap is partly due to surging institutional interest in Ethereum (ETH). Demand from digital asset treasuries and the rise of stablecoins and real-world asset narratives are primary contributors. For instance, Bitmine Immersion Technologies recently acquired 1.15 million ETH through a $20 billion fundraising round, with the potential to expand its ETH holdings to $24.5 billion. Similarly, Sharplink Gaming maintains sizable ETH reserves.
Tokens closely linked to Ethereum, such as ARB, ENA, LDO, and OP, have displayed heightened sensitivity to ETH price movements. Lido DAO’s LDO token, in particular, rose 58% month-to-date, benefitting from both the ETH rally and regulatory clarity from the US SEC, which recently clarified that certain liquid staking activities do not constitute securities offerings if managed in a ministerial fashion.
What’s Next for Altcoin Season 2025?
Coinbase concludes that the combination of expanding institutional interest in Ethereum and improved liquidity for altcoins could set the stage for a full-fledged altcoin season 2025. Regulatory clarity, especially around liquid staking, is also likely to further encourage participation and growth in the altcoin sector.
For a broader understanding of market trends and detailed research reports, visit the Bloomberg Crypto section.
