Ethereum News Today: Ethereum Steals Bitcoin's Spotlight as Altcoin Rotation Hits Record Flow

Investor sentiment in the crypto markets is shifting toward altcoins, with Ethereum (ETH) leading the charge as capital continues to rotate away from Bitcoin (BTC). James Wynn, a prominent crypto analyst, has recently predicted the onset of "Altcoin Season," a period historically marked by strong outperformance of altcoins relative to Bitcoin. This forecast aligns with recent market dynamics, which suggest a growing appetite for Ethereum and other altcoins, driven by regulatory clarity and institutional adoption.

Ethereum’s outperformance has been particularly pronounced in the last week, with inflows into global Ethereum ETPs reaching a record high. On a single day last week, US spot Ethereum ETFs recorded over $1 billion in net inflows across all issuers, a figure significantly higher than the inflows into Bitcoin ETPs. This surge in Ethereum-related inflows has pushed the ETH/BTC ratio to its highest level since December 2024 at 0.38, signaling continued investor rotation into the second-largest cryptocurrency by market cap. Weekly inflows into Ethereum ETPs totaled $2.726 billion, compared to $540 million for Bitcoin ETPs, making Ethereum inflows over five times larger [1].

The outperformance of Ethereum is not an isolated trend. More than 40% of tracked altcoins outperformed Bitcoin on a weekly basis, though this figure represents a slight deceleration from earlier in the month. Cardano (ADA), Chainlink (LINK), and BNB (BNB) were among the top altcoins in terms of relative performance. The shift toward altcoins has been attributed to broader macroeconomic factors, including a rise in global risk appetite. An in-house indicator for Cross Asset Risk Appetite (CARA), which measures risk appetite across traditional asset classes, reached its highest level since early 2021 [1].

One of the catalysts for this shift has been the passage of the Genius Act, which established a foundational regulatory framework for stablecoins in the United States. This development has positioned Ethereum as a key infrastructure asset for compliant digital finance, further attracting institutional capital. Additionally, Ethereum's validator exit queue has expanded to 893,600 ETH—the highest level on record—raising concerns among traders about potential short-term selling pressure [1].

Despite the growing momentum in Ethereum and altcoins, the recent correction in Bitcoin and broader crypto markets has introduced volatility. Bitcoin’s dominance in the crypto market has fallen to 58%, the lowest since January 2025, while its weekly performance turned negative. On-chain data indicates that while whale activity has shown bullish tendencies—with large holders moving Bitcoin off exchanges—overall net buying pressure on spot exchanges has weakened [1].

The market’s response to macroeconomic indicators has also played a role. The U.S. producer price inflation data exceeded expectations, yet traders continue to price in a 84% probability of a Fed rate cut in September. A continuation of the Fed’s easing cycle could extend the current economic expansion and support a prolonged bull market for cryptoassets. The increased likelihood of rate cuts has been a tailwind for risk assets, including cryptocurrencies, which are traditionally more sensitive to monetary policy shifts [1].

In summary, the crypto market is currently in a phase of increased altcoin participation, driven by regulatory developments, institutional adoption, and favorable macroeconomic conditions. While Bitcoin remains a dominant force, Ethereum and altcoins are gaining traction as investors seek higher-risk, higher-reward opportunities. James Wynn’s prediction of an Altcoin Season is being supported by on-chain and fund flow data, suggesting that the trend toward altcoin outperformance may continue in the near term.

Source:

[1] Bitwise_Crypto_Market_Compass_2025_34 (https://bitwiseinvestments.eu/blog/regular-updates/Bitwise_Crypto_Market_Compass_2025_34/)

[2] Cryptocurrencies extend their decline from recent highs (https://www.marketpulse.com/markets/cryptocurrencies-extend-their-decline-from-recent-highs/)

[3] Cryptocurrencies rally on below-estimates US inflation (https://www.aa.com.tr/en/economy/cryptocurrencies-rally-on-below-estimates-us-inflation/3659787)