Ethereum News Today: Altcoin Market Surges 50% Since July Amid Institutional Shift to ETH

The altcoin market has seen a significant increase in capitalization, rising by more than 50% since early July, according to Coinbase’s latest monthly market report released on August 14 [1]. This surge has sparked renewed discussions about the potential onset of an altcoin season, a period historically marked by strong performance in non-Bitcoin cryptocurrencies. The report suggests that this market shift may gain momentum as the year moves into September and beyond.

Bitcoin’s dominance in the crypto market has declined from 65% in May to approximately 59% in August [1]. While the CoinMarketCap Altcoin Season Index remains in the low 40s—below the 75 threshold often associated with a true altcoin season—Coinbase highlights that macroeconomic and liquidity trends are increasingly supporting a reallocation of capital toward altcoins. This includes growing institutional activity in Ethereum (ETH), which has drawn significant investment from digital asset treasuries. These entities now hold nearly 3 million ETH, representing just over 2% of the total supply [1].

The surge in ETH demand has spilled over into related tokens. Tokens with strong correlations to Ethereum, such as Arbitrum (ARB), Ethena (ENA), Lido DAO (LDO), and Optimism (OP), have also experienced gains. Among them, Lido DAO has performed the strongest, rising 58% month-to-date [1]. This rise is partly attributed to recent U.S. Securities and Exchange Commission guidance indicating that certain liquid staking services may not be classified as securities under current interpretations [1].

Coinbase also notes the potential for increased capital flows into crypto from both institutional and retail investors. With over $7.2 trillion held in U.S. money market funds, a record high, expectations are rising for a shift as the Federal Reserve is anticipated to cut interest rates in September and October [1]. This could reduce the yield appeal of money market funds and redirect funds into riskier assets, including cryptocurrencies. Additionally, Coinbase’s liquidity index—measuring stablecoin issuance, trading volumes, and order book depth—has begun to rise after declining for six months [1]. This trend is linked to a more favorable regulatory environment for stablecoins and digital assets.

While Coinbase has not officially declared the start of altcoin season, it has expressed a constructive outlook for the third quarter of 2025. The combination of reduced Bitcoin dominance, increased institutional demand for ETH, and improving liquidity conditions suggests that the stage may be set for a more pronounced altcoin rally in the coming months [1].

Source: [1] Is altcoin season starting? Market cap up 50% since July (https://crypto.news/coinbase-altcoin-market-cap-altcoin-season-2025/)