The ALTCOIN season may be weeks away, according to Coinbase Institutional’s latest monthly prospects that predict a shift in market leadership from Bitcoin to alternative cryptocurrencies beginning in September.
The ALTCOIN season refers to a market phase when cryptocurrencies other than Bitcoin-Ofte led by Ethereums ETH, Solana’s sun and other major cap-tokens records significantly higher percentage gains than BTC over a lasting period.
On August 14th report, author of David Duong, Coinbase’s Global Research Manager, identifies three main drivers: Falling Bitcoin Market Dominance, improving liquidity and growing investor willingness to rotate to assets with higher beta. Duong frames this as a cyclic transition where capital moves down the risk basket as the market’s confidence builds.
Bitcoin dominance – its share of the total crypto market value – has shown signs of softening after topped earlier this year. Coinbase claims that when this measure falls, capital historically flows into alt-cap Altcoins and then into the mid-and-small capital names. They suggest that this rotation effect will be more pronounced in September.
Liquidity trends also become more favorable for altcoins. Coinbase notes tighter bidding-ash spreads and deeper order books across larger exchanges, making it easier for the traders to come in and leave altcoin positions without incurring heavy sliding. Improved liquidity often encourages participation from larger players who can otherwise avoid less traded tokens.
The third factor is mood. Duong writes that when macro conditions stabilize and volatility is contained, investors are more likely to seek higher returns in risky crypto assets. This environment could promote sustained influx to the ALTCOIN market, especially if Bitcoin’s price consolidates rather than overpowering to new heights.
Coinbase stops shortly after predicting which tokens will lead the charge, but highlights the pattern from previous market cycles, where Blue-Chip Altcoins exceeded first, followed by assets with less cap. The report warns that although September can mark the start, the duration and size of the move of both market and macroeconomic conditions depends.
BTC has increased by 27.2% years to date but has drawn some larger altcoins such as Eth (+37.9%) and XRP (+49%)While others like sun (+1.67%)Ada (+8.96%) and DOGE (-27.5%) have the halted. Coinbase maintains that market conditions can generally favor a wider rotation to Altcoins in the coming months.
