Coinbase Forecasts Altcoin Surge in Q3 2025 Amid Fed Rate Cuts and Rising Liquidity

Coinbase has signaled a potential shift in the cryptocurrency market, forecasting a surge in altcoin performance during the third quarter of 2025. The exchange attributes this outlook to favorable macroeconomic conditions, including anticipated Federal Reserve rate cuts and a significant amount of retail liquidity currently held in money market funds, which could be redirected toward altcoins as market dynamics evolve [1]. The firm highlights that historical patterns, particularly those observed during the 2021 bull run, offer a compelling precedent for the current altcoin projections [1].

According to David Duong, Head of Institutional Research at Coinbase, the company’s optimism is rooted in its global M2 money supply index, a metric that has historically led Bitcoin’s price movements by approximately 110 days. Duong noted that this index suggests a new wave of liquidity may emerge in late Q3 or early Q4 2025, further supporting the potential for an altcoin-driven market cycle [1]. The current market environment is also marked by declining Bitcoin dominance and a rising altcoin capitalization, which aligns with typical altcoin season conditions [1].

Analysts from Coincu have added to this narrative, emphasizing that the macroeconomic and regulatory environment could create favorable conditions for top altcoins and decentralized finance (DeFi) projects. These factors, combined with increased retail participation and technological innovation, could serve as key catalysts for a broader market shift [1]. While Ethereum currently trades at $4,642.68 with a market capitalization of approximately $560.41 billion, its price has risen by 86.86% over the past 90 days, reflecting a trajectory that aligns with altcoin growth patterns [1].

The potential for an altcoin surge underscores the growing influence of macroeconomic factors and regulatory developments on the crypto market. As the Federal Reserve prepares its next move in September, retail investors may begin to shift capital toward altcoins, amplifying market momentum. Historical trends suggest that such market dynamics can lead to substantial gains for top altcoins, provided broader liquidity conditions and investor sentiment remain supportive [1].

Source: [1] Coinbase Anticipates Altcoin Surge in Q3 2025 (https://coinmarketcap.com/community/articles/689f0e75be58e26e9d0bd847/)