Preface
As BTC reaches historical highs and ETH rises over 40% in a month, the crypto market has reignited 'bull market expectations'. On-chain capital activity has revived, exchange popularity has clearly increased, and macro signals are also showing favorable trends.
But when you open your wallet and find that altcoins are still stagnating—is this still the bull market you are familiar with?
I. Did altcoins really miss the bull market?
As of May 22, 2025, the price of BTC has surpassed $110,000, setting a new historical high; ETH has risen over 45% in the past month. In this round of emotional recovery, capital and flow are concentrated in mainstream assets. From a macroeconomic perspective, the easing of US-China trade and the rise in global capital risk appetite provide a good upward channel for the entire crypto market.
However, against this backdrop of good news, the altcoin sector remains overall sluggish. Most altcoins not only did not rise but also continued to correct. The popularity of BTC and ETH has overshadowed a directional shift that is happening in the entire market: altcoins are not without markets, but are being consciously 'excluded' by capital and users.
Why does this round of bull market only belong to mainstream coins? Has the value logic of altcoins collapsed? Or do they need a new survival strategy? This article will dissect the challenges and paths faced by altcoins behind this structural bull market from several dimensions: macro environment, capital preferences, user mentality, and mechanism innovation.
II. Macroeconomic environment analysis: Has the bull market really arrived?
1. Easing tariffs and rising risk appetite
As of mid-May 2025, the main tone of the macro market has undergone significant changes.
The trade war between China and the US is easing, and after the Geneva economic and trade talks, a joint statement was issued stating that tariffs will be reduced from a peak of 125% to 10%. This move not only triggered optimism in the market but also released positive signals against inflation.
As a result, the US stock market has entered a structural upward channel. The S&P 500 index has risen from 4,800 points at the beginning of the year to 5,940 points (as of May 20, 2025), approaching its historical high. The risk appetite for capital has clearly increased, with the Nasdaq and large tech stocks rising, while gold and government bonds show signs of capital outflows.
At the same time, the crypto market has also seen significant benefits. According to data from CryptoQuant and CMC, since March, the net inflow of funds into crypto assets dominated by BTC has reached $9.3 billion, most of which is concentrated in the spot market, especially the trading activity during the Eastern US time zone has significantly increased, showing a trend of substantial US capital entry.
2. The upward trend of mainstream coins continues
BTC broke through $110,707 during trading on May 22, 2025, soaring to a historic high; ETH has seen strong gains since April, rising to about $2,629 as of May 22, entering the 'key area' for breaking $3,000.
3. Are mainstream coins becoming a 'safe haven' for funds? What this reflects is a 'preference for certainty'
Regulatory expectations are clearer: BTC and ETH have strong compliance attributes, and the classification by the US CFTC and SEC is becoming gradually clearer;
Liquidity is better: Large institutions (such as BlackRock and Fidelity) continue to absorb BTC through spot products or custody services;
The narrative is more complete: BTCFi and Ethereum L2 ecosystems have recently become the center of a new round of topics.
This has allowed mainstream coins to gain an excess premium in the new round of market, while altcoins have fallen into the marginal zone of capital.
4. The overall trend of altcoins is flat
In contrast, the performance of the altcoin sector is clearly inferior.
The following are the price performances of BTC, ETH, and representative altcoins over the past month (data source: CoinMarketCap, TokenizeXchange):
It can be seen that, except for a few narrative hotspots like AVAX and NEAR experiencing slight increases, most altcoins did not rebound alongside mainstream coins and even saw corrections, with funds further concentrated in mainstream coins.
5. Is the market not 'out of money', but 'unwilling to take risks'?
From Dune's on-chain interaction data, the entire market is not lacking in liquidity, but liquidity is extremely skewed. Buy orders are concentrated in BTC and certain high-heat projects, while the buy-sell depth of altcoins continues to decline. The Google search volume for BTC and ETF has surged.
The bull market in the market has indeed returned, but it seems to only belong to Bitcoin, not to altcoins.
III. Why haven't altcoins kept up?
1. User mentality maturity: The cycle of chasing highs and killing lows is over
During the 2021 bull market, a large number of retail investors entered due to FOMO, blindly chasing various new coin projects, and most ultimately became deeply trapped in the periodic collapse of altcoins. According to a report by data analysis agency Messari, by the end of 2022, over 73% of non-mainstream token investors were in a loss position after holding for 6 months.
After market rotation, by 2025, investors generally form a more cautious trading mindset:
Placing more emphasis on the project's real user numbers and on-chain activity
More inclined to choose projects with mechanism innovation, clear airdrop mechanisms, and ecological support
Not easily 'listening to orders' or blindly betting
According to Dune's on-chain interaction data, the median participation volume of altcoin projects after launch (7-day active addresses) has dropped from over 13,000 in 2021 to currently less than 2,800, and community heat is visibly cooling.
Users are not refraining from entering the market, but are choosing to 'wait smartly'.
2. KOL behavioral transformation: from 'shouting more' to 'arbitrage'
In the past, altcoin projects were extremely reliant on KOL and community dissemination. KOLs converted traffic into price through early position building, live streaming calls, and video content. However, in 2025, as various tracks, memes explode, and project airdrop strategies change, KOLs are beginning to transform more from 'content distributors' to 'market manipulators'.
By observing the KOLs active on X, it is not difficult to find: Before promoting a project, KOLs already have a certain proportion of token pre-allocation positions; after the community is published, they gradually unload and profit on exchanges/DEXs; and there is a clear record of 'pump & dump' behavior.
Especially in some 'hot projects' of the Solana ecosystem recently, KOLs frequently participate in 'airdrop farms + group pulling attention' strategies, leading to an increased probability of losses for ordinary users.
In the long term, this behavior is accelerating the destruction of the trust foundation of altcoins.
3. Sector heat transfer: Narrative can't compete with BTCFi, AI, Restaking
The CoinGecko report pointed out that the current crypto narratives are concentrated in the following three tracks:
Traditional altcoin projects lack connection with mainstream narratives, their narratives are thin, there are no technical breakthroughs, and ecological cooperation is scarce, making it difficult to attract new traffic attention.
The hot topic is no longer 'all coins can rise', but rather capital and users concentrating on 'investing in the right story'.
4. The market's trust and liquidity structure have been rewritten
The trust mechanism of altcoins is collapsing:
Users no longer trust the project parties: Most projects are only active in the initial 30 days after launch, and then liquidity dries up.
Market maker interest is declining: MM strategy institutions are concentrating resources on BTC, ETH, and compliant stablecoins, while trading pairs of altcoins have been delisted by several exchanges.
A more serious problem is that the lack of consensus leads to community 'hollowing out': project parties only have operational accounts and no real community; retail investors are flowing to point systems, airdrop hunter channels, or even AI mining.
This has also led to a new phenomenon—altcoins are no longer about 'speculating blindly', but about 'speculating quickly': no one believes in long-term, everyone is scrambling for short-term liquidity.
The stagnation of altcoins is not because no one pays attention to them, but because there is no reason to believe in them anymore.
When the incentive design of project parties is no longer sustainable, the credibility of KOLs cannot be established, and users' speculation is left with only 'runaway mechanisms', the entire altcoin ecosystem loses its basic trust and liquidity structure.
The next step is to redesign this system instead of repeating old routines.
IV. The rise of new 'altcoin strategies'
1. Exchange-driven airdrops and points mechanisms
Against the backdrop of declining user enthusiasm, some exchanges have designed task systems, point exchanges, and airdrop activities to re-stimulate user participation. In addition, some projects have also begun to introduce point multiplier mechanisms to incentivize users' long-term participation and enhance community activity. The core of these mechanisms is that
Lowering participation thresholds: Rewards can be obtained through simple tasks to attract more users to participate.
Enhancing user stickiness: Points and airdrop mechanisms encourage users to continue participating in the project ecosystem.
Expanding community influence: Recommendation mechanisms prompt users to actively spread the project, increasing its influence.
2. Is launching at the peak? The sustainability of meme coins is in question
Meme coins in 2025 exhibit stronger community-driven characteristics. Project parties quickly gather popularity through social media, community activities, and viral content dissemination. They typically attract market attention quickly through social media before listing on exchanges; once the currency pair is listed, the price rises rapidly and then quickly corrects. Their sustainability is in question, and the market is calling for project parties to continuously optimize aspects such as safety, governance structure, and community building.
V. Future outlook: The breakthrough path for altcoins
1. Do altcoins need to change skins vs. change souls: Repackaging old projects or reconstructing mechanisms?
Whether altcoins still have a chance does not depend on the market, but on whether they can 'self-renew'.
In the past, many projects disappeared during the bear market, and at the beginning of the bull market, they 'revived' by changing their skins: updating a logo, refreshing a roadmap, adding some AI keywords, and then starting to tell stories again. But users in 2025 no longer easily trust 'old wine in new bottles'.
Compared to 'changing skins', truly competitive projects have chosen to 'change souls': reconstructing token economic models, introducing fairer airdrop mechanisms, and even guiding community co-governance through DAOs, allowing users to transition from speculators to ecosystem builders, while relying on extremely simple user experiences and deeply binding on-chain native traffic to achieve sustained activity and liquidity.
The key to breakthrough is not how trendy the packaging is, but how innovative the mechanism is, how genuine the emotions are, and how stable the rhythm is.
2. What do retail investors really need? Narrative? Practicality? Or pure speculation?
In 2021, retail investors were chasing narratives, pursuing imaginative space.
Retail investors in 2025 are more concerned about 'Can I try and err at low cost?', 'Can I sell anytime?', 'Am I being seen as a counterparty by the project parties or KOLs?'
They do not need 'grand visions', but clear expectation management and quick feedback.
This also means that project parties must redesign user participation paths:
The mechanism of tasks, points, and NFTs binding cannot only play with 'incentives'; the 'exit cost' must be included in the design;
No longer pursuing explosive user numbers, but establishing a small and refined 'core loyalty pool';
Let users feel that they are not 'being designed', but 'participating'.
3. How can project parties, platforms, and communities rebuild user trust?
There are two growth engines in the current market:
Exchange/platform-driven traffic systems: Exchanges are reconstructing the user flow path of 'tasks → incentives → airdrops → listing'. This is not only a cold start tool for projects but also a 'sandbox' to control traffic risks.
Community-driven new narrative systems: Telegram fission, creator DAOs, and low-threshold KOL incubation tools (such as Zealy and Galxe) have become the infrastructure for the autonomy of altcoin traffic.
If the previous traffic strategy was 'overwhelming', the current strategy is more like 'igniting a spark': letting early believers engage, earn money, and create real transactions and content, which is likely to achieve fission and natural dissemination.
Summary: Altcoins have reached a point of reshuffling.
Altcoins have not disappeared; they have just reached a point of reshuffling.
Projects that lack mechanism innovation, community participation, and fantasize about a tenfold increase through shouting are bound to sink in this cycle.
But projects that truly understand changes in user behavior, reconstruct incentive structures, and can coexist and win with the community still have the potential to break through in a 'localized bull market'.
This bull market does not belong to all altcoins, but to those players who are serious about their work.
It's not 'whoever shouts the loudest wins', but 'whoever can stabilize people's hearts will live longer'.
