Why We Aren’t Seeing an Altcoin Season in 2024-2025 Like in 2017 & 2021
Back in 2017 and 2021, the crypto market felt like a never-ending money printer. Bitcoin would pump, altcoins would follow, and eventually, some random coin with zero fundamentals would 100x overnight just because it had a catchy ticker. But fast forward to 2024-2025, and despite some serious market cap numbers—
4 altcoins (excluding USDT) over $100 billion
20 altcoins over $10 billion
126 over $1 billion
585 over $100 million
1867 over $10 million
—we're still not getting that classic, explosive altcoin season. So, what’s the deal?
The Fed Is killing the Fun
One word: liquidity. Or rather, the lack of it.
Back in 2017 and 2021, the Federal Reserve was printing money like crazy through Quantitative Easing (QE). That means they were buying assets—mainly government bonds and mortgage-backed securities—injecting fresh cash into the system. More liquidity means more risk-taking, which means people were YOLO-ing into crypto left and right.
Now? Quantitative Tightening (QT). The Fed isn’t just keeping interest rates high; they’re actively selling assets off their balance sheet, pulling money out of the system. Less liquidity means less speculation, and without speculation, the altcoin casino doesn’t get the same kind of action it used to.
High Interest Rates = Less Gambling
When the Fed keeps rates high (currently hovering around 5%+), it changes the investment landscape. Why? Because suddenly, there are safer places to park money with decent returns:
Money market funds are yielding 5%+ risk-free.
Bonds and Treasuries are actually worth holding again.
Institutional money prefers real yield over crypto volatility.
In 2021, when interest rates were near zero, there weren’t many alternatives. If you wanted yield, you either farmed DeFi protocols or threw money at dog coins. Now? Smart money is chilling in T-bills while crypto struggles for new inflows.
Bitcoin Dominance & The Lack of New Retail Money
Another factor? Bitcoin is hogging the spotlight. In classic alt seasons, BTC pumps first, then stagnates, allowing capital to rotate into alts. But this cycle, Bitcoin’s dominance is still high because institutions are mainly buying Bitcoin ETFs, not small-cap altcoins.
On top of that, retail hasn’t really come back in full force yet. Unlike 2021, where every Uber driver and TikTok influencer was shilling coins, we’re still in a phase where most normies are hesitant after the FTX and Terra blow-ups.
Unless the Fed pivots to QE again (which would mean inflation is under control or something breaks in the financial system), liquidity remains tight, and that’s bad news for altcoin pumps. Crypto thrives when money is easy and speculative bets are encouraged. Right now, capital is being drained out of the system, and the market is feeling it.
Could we still get an alt season? Sure—but it won’t be like 2017 or 2021 unless macro conditions change. Until then, Bitcoin and a few major alts might keep climbing, but the days of random meme coins printing 100x overnight? That’s going to need a serious liquidity injection to happen again.
Posted Using INLEO
