Bitcoin News Today: Bitcoin's Decline, Altcoins Rise: A Season in the Making

The Altcoin Season Index has fallen to 45 as of August 2025, signaling a market that remains in Bitcoin's dominance, according to a recent analysis. This figure is well below the threshold of 75—historically considered indicative of an altcoin season, defined as a period where at least 75% of the top 50 altcoins by market capitalization outperform Bitcoin over a 90-day period. Despite this, the total altcoin market cap has increased by over 50% since early July, reaching $1.4 trillion as of August 12 [1]. This divergence highlights the growing institutional interest in Ethereum (ETH), particularly in light of rising demand from digital asset treasuries and the expanding narrative around stablecoins and real-world assets [1].

Bitcoin’s dominance has steadily declined from 65% in May 2025 to approximately 59% by August 2025, suggesting early signs of capital rotation into altcoins [1]. Analysts have pointed to this as a potential precursor to a full-scale altcoin season, with conditions expected to evolve further as the market heads into September. The altcoin open interest dominance ratio has also experienced a notable spike, another indicator often associated with increased altcoin participation [1].

The broader macroeconomic landscape has also contributed to a constructive outlook for altcoins. With over $7.2 trillion in U.S. money market funds—representing the highest cash stockpile on record—investors are increasingly looking for alternative opportunities amid economic uncertainty, high traditional market valuations, and concerns about global economic growth [1]. Recent data also indicates that liquidity in the crypto market is showing signs of recovery, as measured by factors such as net stablecoin issuance, spot and perpetual trading volumes, and orderbook depth [1]. This liquidity rebound is being attributed in part to a clearer regulatory environment for stablecoins and digital assets more broadly.

Ethereum-related altcoins have shown particular strength in recent months. Tokens like ARB, ENA, LDO, and OP have demonstrated higher beta levels relative to ETH, meaning they are more volatile in response to ETH’s daily movements [1]. Among these, LDO has seen the most significant performance, gaining 58% in the month to date. This rise was supported by the U.S. Securities and Exchange Commission’s (SEC) recent clarification that liquid staking tokens may not be classified as securities under specific conditions, offering regulatory clarity to the sector [1].

Looking ahead, analysts remain cautiously optimistic about the potential for a more mature altcoin season later in 2025. While the current market does not yet meet the traditional definition of altcoin season, the combination of increasing altcoin market cap, declining Bitcoin dominance, and favorable macroeconomic conditions suggests that the environment is becoming more conducive to altcoin growth [1]. This view is further supported by the anticipated regulatory advancements and the potential for increased retail participation following expected Federal Reserve rate cuts in September and October.

Source:

[1] Monthly Outlook: Altcoin Season Cometh (https://www.coinbase.com/institutional/research-insights/research/monthly-outlook/monthly-outlook-aug-2025)

[2] Altcoin Season Index | Altcoin Dominance Chart (https://www.bitget.site/price/altcoin-season-index)