Is there still an altcoin season? Many brothers have been asking this topic recently. My view is that altcoins are still to be expected, but the dominance of Bitcoin, macroeconomic pressures, and regulatory hurdles have temporarily pressed the pause button on the altcoin frenzy. However, once BTC enters a stable period and liquidity returns, altcoins will welcome their moment.
Currently, the reasons why the altcoin season has not started are:
1. The 2024 Bitcoin halving event reinforces its scarcity narrative, attracting funds that might have flowed into riskier altcoins.
2. Liquidity tightening and quantitative tightening have drained liquidity from financial markets, reducing risk appetite. As speculative assets, altcoins rely on excess capital; without liquidity, they can only stagnate.
3. Delayed interest rate cuts: Although there are rumors in the market that the Federal Reserve may shift to a loose policy, as of May, the probability of interest rate cuts is still low.
4. Too many cryptocurrencies, but liquidity cannot keep up. New projects are launched every day, but the total capital pool remains dispersed, leading to diluted potential returns. More tokens are competing for the same liquidity, making it difficult for even promising projects to gain attention.
Currently, being patient and selectively investing in projects with strong fundamentals—such as artificial intelligence, DeFi, or Layer-2 solutions—is key.
