CMC News

Short Cycles and Violent Rotations Replace Altseason, Says DWF Labs

The broad altcoin rallies that defined previous crypto cycles are no longer a realistic market feature, according to Andrei Grachev, managing partner of DWF Labs. Grachev told Cointelegraph that the structural conditions supporting altseason no longer exist. Three factors are driving the change: an oversupply of tokens competing for limited capital, a smaller base of active market participants, and the rise of crypto ETFs. #altcoins

ETFs are concentrating liquidity in large-cap assets rather than allowing it to filter down through the broader market, Grachev said. Institutional investors are focused on $BTC, $ETH, and tokenized real-world assets, leaving smaller tokens with fewer buyers. CoinMarketCap now tracks more than 37.8 million unique tokens, a figure that has grown sharply since 2023. #crypto

"The capital is not going to keep expanding fast enough to support all of it," Grachev said. He added that the result will be shorter windows for narrative-driven rallies, more abrupt rotations between sectors, and less tolerance for projects that rely on momentum rather than fundamentals. Matt Hougan, chief investment officer at Bitwise, reached a similar conclusion, saying institutional capital is now directed toward yield-bearing instruments or assets that generate measurable revenue. #Bitcoin

The altcoin market cap data supports that assessment. The total altcoin market cap reached $1.19 trillion in October 2025 before the subsequent crash pulled it back to approximately $719 billion. More than $209 billion has left the altcoin market over the past 13 months. CryptoQuant analyst Darkfost said 38% of altcoins are currently trading near all-time lows, a worse reading than the period following the FTX collapse. #altseason

Bitcoin #ETFs recorded five consecutive days of positive inflows this week, according to data from fund manager Farside Investors.