Altcoin season has not been officially declared, but rotation is already showing up in the market, and the numbers are getting harder to ignore.
Over the past 30 days, memecoin launchpad PONS has climbed more than 350%. In DeFi, Uniswap’s UNI gained more than 110%, Arbitrum’s ARB rose over 150%, and AI-focused NEAR advanced about 180%, according to Cointelegraph.
Last week, privacy token Zcash reached a record high above $1,600. CoinMarketCap data also placed Bitcoin Layer-2 token LIT and memecoin launchpad token PUMP among the biggest gainers over the same period.
The gains span very different sectors. They do not point to one obvious trade, but they do suggest that many traders are paying closer attention this time to tokens with a clearer business case behind them.
Rotation has started before an official altseason call
Bankless podcast host David Hoffman said Friday that tokens such as ARB, UNI, Jupiter’s JUP and Ondo’s ONDO share one trait: 「They make money, they all print revenue」. His view is that the rally may be getting support from utility rather than pure speculation.
Among the 20 biggest gainers last week, only two were memecoins. Over the past week, only Pudgy Penguins made that list.
That does not mean fundamentals are the only force in the market. 1inch co-founder Sergej Kunz said memecoins showed the strongest growth among buyers over the last 30 days, while DeFi protocols, privacy tokens, AI projects and tokenized assets also drew attention.
Kunz told Cointelegraph Magazine, 「The pattern so far is breadth before depth」, meaning more wallets are buying a broader range of tokens, but usually in smaller size.
He added, 「The caution in the data fits the broader pattern of selective participation」 and said users are participating 「selectively rather than going all-in」.
What could make this altseason different
It is still too early to say whether the market is becoming more discerning and allocating into assets with real utility, as Hoffman argues, or whether it will once again end up being led by memecoins built around dogs in hats and sexual innuendos.
One reason for that caution is that CoinMarketCap’s official index has not yet entered Altcoin Season. It currently stands at 64 out of 100, up from 48 last week, but still below the threshold of 75 that marks an official new season.
A small number of coins still account for most of the market. Trading firm Talos said the top 10 altcoins now represent roughly 80% of total altcoin market capitalization, up from around 70% at the end of 2024.
Samar Sen, head of international markets at Talos, said the data is 「pointing to a market where capital is clustering around a smaller number of assets rather than rotating broadly into the long tail」.
He also said Talos’ September flow data showed a 「notably strong buying tilt」, with buying dominating on almost every day. Sen contrasted that with late 2024, when buyers and sellers were more evenly matched and the post-election rally produced broader outperformance across tokens including DOGE, ADA and HBAR.
What traders are actually buying
According to Sen, the strongest performance is tied to specific themes, including revenue-generating protocols, onchain perpetuals and DeFi projects such as HYPE, LIT, UNI and MORPHO.
Privacy-related assets including ZEC, NEAR and XMR are also performing strongly, alongside AI-adjacent tokens such as VVV and TAO.
Talos is also seeing heavy activity around memecoin launchpads, including PUMP and PONS. The Robinhood ecosystem and the USELESS memecoin are also performing well.
PONS is the biggest gainer over the last 30 days.
Like Kunz, Sen said the market is becoming 「much more selective」.
Tokenized gold and tokenized stocks are drawing more buyers as well, and AI tokens are rising too, though Sen said that is still 「from a small base」.
Even so, the market does not yet look like a clean wholesale shift from speculation to utility. The picture is closer to a mix of competing narratives moving at the same time.
That overlap became visible earlier this month with the surge in unconventional trading pairs on Robinhood. Tokenized stocks suddenly began trading against memecoins through pairings such as BONER/HIMS and SPACEHOOD/SPCX.
One of those pairings generated more than $425 million in 24-hour trading volume in early September.
The argument for a more fundamentals-driven cycle
Michael Egorov, founder of Curve Finance and Yield Basis, said he is seeing more attention on real use cases and institutional demand than in previous cycles.
He said, 「All in all, I’d say there’s now more interest in protocols that actually do something useful, can connect crypto with real financial activity, and prove it in action」.
Stablecoins are one example, he said, especially in onchain foreign exchange and fintech applications. In his view, the biggest driver will be the growing integration of crypto infrastructure with the real economy.
If that demand keeps growing, it could give this altseason a new source of buying as crypto infrastructure becomes more useful outside crypto trading itself. The report also notes that this remains a big if.
Who is driving the rally
Talos data shows dealer participation in altcoin trading has fallen from around 65% at the end of 2024 to about 32% in September, even as flows maintained a strong buying trend.
Sen said, 「That is a significant difference from the last altcoin rally」 and added that liquidity providers and market makers have so far played a smaller role in the current move.
At the same time, he said access has become easier. Exposure that once required traders to interact directly with decentralized venues such as Raydium or Orca is now available through mainstream platforms. In his words, that 「lowers barriers to entry and broadens retail participation」.
Professional traders also have more tools to follow capital this cycle, from wallet tracking to copy trading, which can provide signals on how money is moving across wallets, protocols and chains.
According to Sen, that has created a combination of broader retail access and more sophisticated ways for professional traders to identify where activity is building.