Bitcoin News Today: September 2025: Capital Shifts, Altcoin Season Looms

Coinbase Institutional has forecasted that a significant shift is emerging in the cryptocurrency market, with early signals pointing toward the potential onset of a full-scale altcoin season as September 2025 approaches. This transition is being driven by a combination of declining Bitcoin dominance, improving liquidity for altcoins, and growing investor interest in higher-risk assets. The firm notes that the market is currently in a cyclical phase where capital is beginning to move away from Bitcoin and into alternative cryptocurrencies, particularly large-cap tokens such as Ethereum (ETH), Solana (SOL), and others.

Bitcoin's market dominance, which measures its share of the total crypto market capitalization, has fallen from approximately 65% in May 2025 to 59% by August 2025. This decline is seen as a key indicator of capital rotation into altcoins. Historically, such a drop has preceded increased activity in large-cap altcoins, with a subsequent ripple effect into mid- and small-cap assets. The Altcoin Season Index, a widely referenced metric for tracking this market dynamic, currently stands at around 44, well below the threshold of 75 typically associated with a full altcoin season. However, it has shown improvement from its July lows, indicating early positive signs [1].

Liquidity trends have also improved for altcoins, with tighter bid-ask spreads and deeper order books across major exchanges. These developments make it easier for traders to execute large positions without causing significant price slippage, a factor that often discourages participation in less liquid assets. Coinbase highlights that these conditions are encouraging greater involvement from institutional players and could support sustained inflows into the altcoin market [2].

The firm also notes that institutional interest in Ethereum is intensifying, supported by demand from digital asset treasuries and narratives around stablecoins and real-world assets. For instance, Bitmine Immersion Technologies recently raised $20 billion to acquire ETH, demonstrating robust institutional appetite for the asset. This increased demand is expected to further amplify the performance of higher-beta tokens that are closely tied to Ethereum, such as Lido’s LDO token, which has seen a 58% month-to-date gain [3].

Regulatory clarity has also contributed to the current favorable conditions. A recent U.S. Securities and Exchange Commission (SEC) statement on liquid staking provided some clarity, reinforcing that such activities do not constitute the sale of securities under certain conditions. This regulatory development has added a layer of confidence for investors seeking exposure to Ethereum through liquid staking mechanisms [4].

While Coinbase acknowledges that a full-scale altcoin season has not yet materialized, the firm believes the conditions are aligning for such a scenario in the coming months. It anticipates that as Bitcoin consolidates its price, institutional and retail investors will continue to shift capital toward altcoins, particularly those with strong narratives and technological innovations. However, the firm cautions that the duration and magnitude of this shift will depend on broader macroeconomic factors, including Federal Reserve interest rate decisions and global liquidity trends [5].

In the broader context, altcoin season is typically characterized by a market environment where at least 75% of the top 50 altcoins outperform Bitcoin over a 90-day period. As of August 12, the total altcoin market cap had grown by over 50% since early July, reaching $1.4 trillion. While Bitcoin has outperformed many altcoins year-to-date, the performance gap has been narrowing, with some major altcoins like Ethereum and XRP significantly outpacing BTC [6].

Source: [1] Altcoin Season Could Begin in September as Bitcoin's Grip on ... (https://finance.yahoo.com/news/altcoin-season-could-begin-september-061652116.html) [2] Bitcoin Slows, Altcoins Surge: Coinbase Believes a Full- ... (https://cryptopotato.com/bitcoin-slows-altcoins-surge-coinbase-believes-a-full-scale-altseason-here/) [3] Coinbase Says Market Signalling Potential Rotation From ... (https://dailyhodl.com/2025/08/16/coinbase-says-market-signalling-potential-rotation-from-bitcoin-predicts-full-scale-altcoin-season-heading-into-september/) [4] Monthly Outlook: Altcoin Season Cometh (https://www.coinbase.com/institutional/research-insights/research/monthly-outlook/monthly-outlook-aug-2025) [5] Coinbase says a 'full-scale altcoin season' may be just ahead (https://cointelegraph.com/news/current-market-conditions-suggest-shift-towards-a-full-scale-altseason-coinbase) [6] What is altcoin season? When will altseason start in 2025? (https://yieldfund.com/what-is-altcoin-season-when-will-altseason-start-in-2025/)