Mainstream adoption has surpassed alt season - a perspective on the current state of crypto markets

The crypto markets are undergoing a significant transformation, moving away from the traditional focus on Bitcoin dominance and altcoin seasons towards a perennial state of capital influx into regulatory-compliant and structured financial instruments.

This shift is largely influenced by the regulatory clarity provided by the American administration, which is acting as a primary growth catalyst for institutional investment in crypto. Institutional investors and retailers are no longer waiting for a specific Bitcoin or altcoin season to get into crypto; they are focused on long-term value generation and problem-solving.

The trend is evident in the spike in retail crypto adoption rates, with 29% and 27% of Americans and Britons, respectively, adopting crypto over the last six months. Meanwhile, the old playbook of capital automatically rotating into altcoins after a Bitcoin rally is being replaced by a focus on institutional-grade projects with robust infrastructure and compliance.

The current trend is characterized by a strong institutional adoption, driven largely by the rise of regulated investment products such as Bitcoin ETFs. This has led to a prolonged and more stable Bitcoin dominance phase, which is altering traditional Bitcoin versus altcoin seasonal cycles.

Instead of the classic altcoin seasons marked by speculative surges in smaller cryptocurrencies, institutional investors are favoring larger, proven assets like Bitcoin and Ethereum. This is resulting in delayed or fundamentally changed altcoin seasons focused on quality rather than broad speculative enthusiasm.

Key points explaining this trend include record Bitcoin ETF inflows and institutional demand, which are fueling sustained Bitcoin price rallies, pushing Bitcoin dominance higher and increasing market capitalization past $4 trillion. Altcoin season delays or selective alt seasons are due to institutional preferences for lower-risk assets, with widespread altcoin rallies as seen in 2017 and 2021 being replaced by more selective interest in established altcoins with strong fundamentals.

Improved regulatory clarity worldwide supports legitimate use cases and long-term holding strategies, favoring stable, established cryptocurrencies over speculative ones. Technological progress in ecosystems like Ethereum (e.g., EIP-4844 upgrades) and Solana enhances their appeal, aligning with institutional interest towards blockchain projects with strong infrastructure and utility.

The market cycles are evolving, with institutional involvement, ETF structures, and regulatory frameworks likely making Bitcoin seasons longer and less volatile, changing the cyclical patterns that previously led to rapid shifts between Bitcoin and altcoins.

In conclusion, the rise of regulated investment products and ETFs is fostering a maturing crypto market where Bitcoin maintains dominance and altcoin seasons are more selective and quality-driven, diverging from earlier speculative cycles. Investors are advised to focus on fundamentals, thorough research, and risk management given this shifting landscape.

Meanwhile, on the technological front, Pocket Network, a decentralised infrastructure network, is leading the way. Supporting over 10,000 nodes powering data access for global AI and crypto applications, Pocket Network has served over a trillion relays to date across 50+ blockchains. The head of operations at Pocket Network, Chris "Jinx" Jenkins, is leading the network's Shannon upgrade, designed to boost modularity, reliability, and real-time performance.

References: [1] CoinDesk (2022) The Institutional Bitcoin Market Is Here to Stay. [online] Available at: https://www.coindesk.com/business/2022/03/07/the-institutional-bitcoin-market-is-here-to-stay/ [2] Cointelegraph (2022) The changing landscape of altcoin seasons: Why institutional investors are driving quality over quantity. [online] Available at: https://cointelegraph.com/news/the-changing-landscape-of-altcoin-seasons-why-institutional-investors-are-driving-quality-over-quantity [3] Decrypt (2022) Ethereum's EIP-4844 upgrade could boost its appeal to institutional investors. [online] Available at: https://decrypt.co/94201/ethereums-eip-4844-upgrade-could-boost-its-appeal-to-institutional-investors [4] The Block Crypto (2022) Bitcoin's dominance is growing, but altcoins are still alive and kicking. [online] Available at: https://www.theblockcrypto.com/post/117156/bitcoins-dominance-is-growing-but-altcoins-are-still-alive-and-kicking

Mainstream adoption has surpassed alt season - a perspective on the current state of crypto markets