What followed was one of the most abrupt and concentrated retail losses since the early 2022 bear market. Despite Bitcoin staying in a macro uptrend, retail sentiment around altcoins quickly soured, and the once-promised altseason faded almost as soon as it began.
Institutional Investors and ETFs Changed the Game
Meanwhile, institutional behavior has fundamentally changed how capital flows in the crypto market. Spot Bitcoin ETFs launched in January 2024 and attracted over $129 billion in inflows by year-end. These products offered a safe, regulated entry point for both institutional and retail investors—capital that may have otherwise rotated into altcoins in previous cycles.
With options and futures products now available for ETFs, sophisticated investors can gain exposure to Bitcoin or Ethereum (ETH) while hedging downside risk. This reduces the incentive to take on additional risk through smaller, less liquid altcoins.
The contrast is stark. While BTC ETFs shattered records, Ether ETFs – which launched in July 2024 – have only brought in about $2.43 billion in net inflows over a longer period until March 27, 2025, according to CoinGlass. This suggests that product structure alone doesn’t drive investment – conviction does. And right now, that conviction overwhelmingly favors Bitcoin.
The Evolution of Altcoins
Part of the problem may be definitional. The term “altcoin” used to mean “anything that’s not Bitcoin,” but the term now lumps together a wide array of asset types – from governance tokens and memecoins to DeFi coins and tokenized real-world assets (RWAs).
These assets are increasingly behaving as distinct sectors, not as a unified group. Data shows RWAs surged 15x this cycle, while GameFi lost half its market cap. Ethereum continues to dominate DeFi, Solana leads in memecoins, and networks like ImmutableX are carving out niches in gaming.
This divergence supports the idea that the altseason concept may no longer apply. Instead, capital now rotates based on narratives, utility, and market structure—leading to isolated rallies rather than synchronized surges.
Will Altcoin Season Take Place in 2025?
Despite the subdued performance of altcoins in early 2025, some investors still believe the best is yet to come. But on-chain and macro data paint a more cautious picture.
CryptoQuant CEO Ki Young Ju recently noted that “the era of everything pumping is over.” He explained that most capital now enters crypto through spot ETFs – a trend that doesn’t register on traditional on-chain metrics but nonetheless changes market behavior. With liquidity tightening and new whales selling into rallies, Ju expects sideways or bearish price action over the next 6–12 months.
