What stimulus the crypto market needs for altcoins. Bitcoin holds its position better than other cryptocurrencies, but alternative digital coins need liquidity

There are no conditions for altcoins to start growing now, Matrixport analysts believe. They published a market review under the title “Altcoins Come and Go - Only Bitcoin Remains” (Altcoins Come and Go - Only Bitcoin Remains). According to their assessment, alternative cryptocurrencies to bitcoin will not be able to start growing until new liquidity appears in the sector.

 Matrixport is a Singaporean crypto platform owned by billionaire entrepreneur Jihan Wu, who is also the co-founder of the largest mining equipment manufacturer Bitmain. The trading turnover of the Matrixport platform is $5 billion per month.

Since the launch of spot exchange-traded funds (ETFs) on Ethereum in the United States in the summer of 2024, the market share of the leading altcoin has fallen by almost 50%, Matrixport notes. According to experts, if Ethereum is the “oil” that fuels the crypto economy, then the current state of this economy resembles a deep recession.

But Ethereum is not the only altcoin losing ground to bitcoin. Experts have pointed out that countless cryptocurrency narratives have appeared and disappeared over the past year, from Dogwifhat (WIF) to US President Donald Trump's memcoin Official Trump (TRUMP). Experts note that these tokens often “live” according to the same pattern: sharp, euphoric growth, followed by an equally sharp collapse, forming pyramid-like price structures with long, elongated tails symbolizing oblivion.

For altcoins to gain significant growth momentum, we would need to see either an increase in demand driven by viable asset options or a surge in liquidity similar to what was seen during the 2020-2021 cycle, the report said. However, based on the metrics tracked, analysts concluded that a significant influx of liquidity into the crypto market seems unlikely, making near-term altcoin growth unlikely as well.

The US Federal Reserve (Fed) is likely to keep interest rates unchanged over the summer as it assesses the inflationary impact of Trump's proposed duties, experts said. They pointed to a situation in which markets are forecasting four rounds of rate cuts for 2025 and Fed Chairman Jerome Powell is emphasizing the need for a cautious approach to assessing the economic impact of the new tariffs.

In addition, the issuance of stablecoins has sharply decreased recently. Analysts called it a signal of low liquidity. This supports the prediction that bitcoin is likely to remain in the $80k to $90k range for now. Trading volumes, including bitcoin-ETFs, also remain low, telling experts there is limited speculative activity.

“Investors seem preoccupied with their inefficient equity portfolios as Trump's drive to renegotiate trade agreements and change the world order has a big impact on the markets,” Matrixport said.

What the analysts find interesting is that the tariff situation has led to a weaker US dollar. Since the global money supply is usually measured in dollars, a weakening of the U.S. currency leads to a mechanical increase in the money supply. This effect has historically supported bitcoin prices, experts reminded.

They noted that bitcoin's “survival” has often been questioned in past bear markets, largely due to regulatory concerns, heavy enforcement or outright bans. That risk has now diminished significantly, which helps explain why bitcoin is holding up much better during the current correction than in previous cycles, the report said.

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