Altseason Era Ends as ETFs Concentrate Liquidity in Top Assets
According to Andrei Grachev, managing partner of DWF Labs, the conditions that supported altseason are no longer present in the crypto market. This shift is due to three key factors: an oversupply of tokens competing for limited capital, a smaller base of active market participants, and the rise of crypto ETFs.
The concentration of liquidity in large-cap assets like Bitcoin and Ethereum via ETFs has left smaller tokens with fewer buyers. Institutional investors are focused on these major assets and tokenized real-world assets, rather than spreading their capital across the broader market.
CoinMarketCap now tracks over 37.8 million unique tokens, but Grachev warns that 'the capital is not going to keep expanding fast enough to support all of it.' This has led to shorter windows for narrative-driven rallies and more abrupt rotations between sectors.