- Bitcoin and stablecoin dominance has faced another rejection at a familiar ceiling, a recurring signal that historically marked powerful altcoin rallies.
- Liquidity expansion and retail participation remain missing, but once triggered, conditions align for rapid capital rotation into altcoins across multiple sectors.
- Previous altseasons were fueled by clear narratives like DeFi and NFTs, and 2025 awaits a dominant theme to ignite sustained altcoin growth.
Altseason may be on the horizon as Bitcoin and stablecoin dominance once again rejects a long-standing ceiling, echoing historical signals that preceded major altcoin rallies. Market watchers now debate whether this could set the stage for the largest rotation yet.
Bitcoin and Stablecoin Dominance Faces Familiar Ceiling
Crypto research shared by Bull Theory highlights that Bitcoin dominance alone is no longer sufficient to track market trends, given the increasing weight of stablecoins in total capitalization. Instead, Bitcoin and stablecoin dominance combined presents a more accurate measure.
Every cycle, this combined dominance has hit a ceiling before being rejected, followed by periods of strong altcoin growth. Notably, the 2019 rejection was followed by a broad altcoin rally, while the 2020 rejection coincided with the start of DeFi summer.
The most prominent case occurred in 2021 when rejection from the ceiling signaled one of the most expansive altcoin rallies on record. In 2025, data shows the same ceiling has again been rejected, renewing expectations of another large-scale rally.
Why Altcoins Have Not Rallied Yet
Despite this technical signal, altcoins have not yet delivered strong moves. Analysts point to liquidity as the primary missing factor. Monetary easing measures such as rate cuts and quantitative expansion have not yet been introduced, keeping risk-on capital sidelined.
This absence of liquidity caused a delay in the theme of capital rotation that is often seen following a peak in bitcoin dominance, as investors want to see clear evidence of a shift in macroeconomic conditions before aggressively rotating capital into altcoins.
Retail activity is also subdued compared to earlier cycles. Online searches and social interest remain below the levels seen in 2021, reducing the flow of speculative participation that usually amplifies altcoin gains.
Awaiting a Clear Narrative for Capital Rotation
Another key driver of previous altseasons was the emergence of strong market narratives that drew attention and investment into specific sectors.In 2021, decentralized finance, non-fungible tokens, and Metaverse-themed tokens were phenomenal growth drivers to an extent that levels of growth were unprecedented.
In comparison, the current cycle has produced multiple themes, including artificial intelligence tokens, real-world asset tokenization, and Ethereum-based staking. However, no single category has yet captured broad momentum to lead the market.
Bull Theory notes that once a dominant narrative forms, it could quickly accelerate capital rotation into altcoins. Combined with the decline in Bitcoin and stablecoin dominance, this could provide conditions for a massive altseason rally surpassing previous cycles.
