2025-07-23
As of August 2025, the crypto market is showing early signs of an altcoin season, but not a full one. Bitcoin is trading near $118,000 (with intraday highs above $124,000 in mid-August 2025).
Elsewhere, Ethereum recently tested highs near $4,788 and has been trading in the roughly $4,200–$4,600 range (mid-August 2025), and the Altcoin Season Index was in the low-40s in mid-August 2025, well below the 75 threshold for an altseason
Meanwhile, Bitcoin dominance (BTC.D) has fallen from ~65% in mid-2025 to roughly 58–60% in mid-August, a sign of early capital rotation into altcoins, but not confirmation of a full-blown altseason.
To simplify, the Altcoin Season Index measures how many of the top 100 altcoins have outperformed Bitcoin over the past 90 days. A reading above 75 indicates a full-blown altcoin season, while a reading below 25 signals a Bitcoin-dominated cycle.
Based on analyst frameworks, the altcoin season has distinct phases:
Phase 1: Bitcoin outperforms.
Phase 2: Ethereum leads BTC.
Phase 3: Large-cap alts dominate.
Phase 4: Small-cap and meme coins skyrocket—and often top out.
We appear to be in early Phase 3, with ETH/BTC strength signalling a deeper rotation.
Bitcoin capital reallocation: After significant gains in Bitcoin (BTC), investors are now looking for higher returns in altcoins.
Macroeconomic liquidity: Easy monetary policy and institutional inflows via BTC/ETH ETFs free capital for altcoin speculation.
Narrative and innovation cycles: There is growing interest in Layer-2 solutions, decentralised finance (DeFi), AI-themed projects, meme coins, and gaming-related altcoins, which is driving a frenzy in the market.
Not fully, but the signs are building.
Altcoin Season Index: Low-40s → early rotation; <75, so not a full altseason.
Bitcoin Dominance (BTC.D): Fell from roughly ~65% in May–June 2025 to about 58–60% by mid-August 2025.
Performance Highlights
Several large-cap altcoins (including ETH, SOL, ADA, XRP) have posted double-digit gains over recent months, while selective small-cap and gaming tokens have recorded much sharper moves.
Together, these indicators suggest the alt season is emerging but not yet in full swing.
Key Indicators to Monitor
Altcoin Season Index rising above 75 will confirm full-season status.
Historically, a decline in Bitcoin dominance to between 50% and 60% typically signals the beginning of altseason.
TOTAL3 index trends: Monitoring altcoin market cap vs. BTC; technical patterns (like cup-and-handle) may signal continuation to $2T.
Futures volume: ETH futures nearing Bitcoin volumes denotes institutional rotation
Past cycles in 2017–18 and 2020–21 exhibited similar patterns, where Bitcoin rallied, followed by surges in altcoins. For instance, the April 2024 event prompted capital to shift into altcoins, resulting in explosive rallies for altcoins in the following year.
These seasons coincide with a decline in Bitcoin dominance (BTC.D), as investors rotate into Ethereum, DeFi tokens, memecoins, and emerging narratives.
Now, institutional flows, macro liquidity, and killer narratives suggest 2025 could echo those cycles, but with more selective upside, favouring quality projects over blanket speculation.
Index: Low 40s (neutral-to-bullish).
BTC dominance: ~58–60% (falling, but not low enough for mania).
Stage: In the early and mid alt season, there isn't yet a frenzy driven by memes.
Analysts suggest that if macro liquidity holds, the index could push into the 75–80 range by late Q3 2025, confirming full altseason. The duration could last weeks to a few months, with the final phase marked by rapid, unsustainable pumps in smaller-cap coins.
Phase-based strategy: Accumulate ETH and large alts in Phase 2–3; shift to small/meme coins in final stages.
Use index triggers: Enter once Altcoin Season Index hits 30–50; take profits as it surpasses 75.
Dollar-cost average into core alt holdings.
Tight risk controls: Use stop-losses due to altcoin volatility.
Watch BTC.D: Rotate back if it rebounds above 60%.
Track futures market data: Shifts in trading volume between ETH and BTC indicate a change in market sentiment.
High volatility: Altcoins can experience rapid increases and decreases in value, often losing between 50% to 90% of their worth after reaching their peak.
Timing risk: Late entry in Phase 4 meme frenzy often leads to sharp drawdowns.
Regulatory uncertainty: Policy changes could halt momentum.
Liquidity traps: Some altcoins are illiquid and prone to manipulation.
1. What Is the Altcoin Season Index and How Is It Calculated?
The Altcoin Season Index measures how many of the top 50 or 100 altcoins have outperformed Bitcoin over the past 90 days. If more than 75% of altcoins outperform BTC, it signals an altcoin season.
2. How Accurate Is the Altcoin Season Index in Predicting Market Trends?
Although not flawless, the index serves as a commonly utilised measure of sentiment and performance. Combined with Bitcoin dominance and liquidity data, it helps traders anticipate altcoin rotation phases.
3. Are We in an Altcoin Season Right Now (2025)?
As of August 2025, the Altcoin Season Index is in the 40–50 range, showing early rotation into altcoins but not yet a full altseason. A move above 75 would confirm it.
In conclusion, we are currently in the initial Phase 3 of the altcoin rotation cycle. Ethereum, Solana, and other majors are gaining, but the Altcoin Season Index remains around the low 40s, not yet signalling a full-blown mania.
Investors who position carefully can benefit from this transitional stage, but discipline is critical. For high-risk traders, the later phases will bring bigger (but riskier) opportunities. Until then, patience and selectivity remain the winning strategy in 2025.
Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
