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crypto.news 2025-04-18 12:59:22

Here’s why we won’t see altcoin season any time soon, according to analysts

Analysts say that an altcoin season is unlikely anytime soon, citing factors such as a lack of dovish Fed policy, macroeconomic uncertainty, and insufficient liquidity drivers. According to Matrixport analysts , Ethereum’s ( ETH ) dominance has plunged nearly 50% since the launch of the U.S. Ethereum spot ETF, which failed to reignite sustained interest in the altcoin market. As a result, all recent altcoin narratives — from meme coins to AI tokens and Layer 2 ecosystems — have mostly followed a familiar “pump and dump” pattern lately, failing to sustain upward momentum. Matrixport outlined three catalysts that are necessary to revive the altcoin market: A dovish pivot by the U.S. Federal Reserve, such as interest rate cuts; Continued growth in stablecoin issuance, which reflects improving micro-level liquidity; Macro liquidity drivers, such as increased credit or government stimulus programs. Absent these conditions, analysts at Matrixport believe altcoins are unlikely to see large-scale gains any time soon. You might also like: ‘We do not need to be in a hurry’: Powell urges patience in speech However, as things currently stand, the altcoin revival looks unlikely in the near term based on these factors. First, a dovish pivot from the Fed appears unlikely. Chair Jerome Powell has recently emphasized a wait-and-see approach , noting that the central bank can afford to hold rates steady while it evaluates the economic impact of recent policies — most notably, Trump’s tariffs. On the macro liquidity side, the escalating tariff war might lead to inflationary pressure due to rising import costs, which could delay any potential monetary easing from the Federal Reserve. However, things are looking good on the stablecoin front. According to Maxtriport’s eartlier report , the market caps of the two leading stablecoins Tether ( USDT ) and USD Coin ( USDC ) have seen substantial growth over the past eight months, suggesting that liquidity is still moving into crypto amid macroeconomic uncertainty. USDT’s market cap rose by 26%, from around $113 billion in August to over $143 billion in April, despite partial delistings on some European platforms due to non-compliance with MiCA regulations. USDC saw 93% increase, growing from just over $31 billion to roughly $60 billion in the same period. To conclude, even though stablecoins have experienced significant growth, the Fed’s cautious stance and ongoing tariff tensions make a revival of the altcoin market unlikely in the near term. Metrics back this up, as the CMC Altcoin Season Index is currently sitting at just 16, indicating that altcoins are far from entering a sustained rally. You might also like: Stablecoin inflows persist amid macro uncertainty: Matrixport

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