Too many tokens? Analysts argue that oversupply could end the altcoin era.

Cryptocurrency analysts and traders are arguing that the altcoin era — the period when alternative cryptocurrencies outperformed Bitcoin in market share — is over.

Historically, altcoin periods have been marked by significant price rallies for non-Bitcoin cryptocurrencies.

In the 2017-2018 cycle, the altcoin market experienced its most explosive growth, with coins such as Ether (ETH), XRP (XRP) and Litecoin (LTC) posting record-breaking gains.

Crypto analyst Ali Martinez argues that the current abundance of altcoins makes a sustained altseason unlikely.

“There are 36.4 million altcoins in the 2017-2018 alt season, compared to less than 3,000 and even less than 500 altcoins in 2013-2014,” Martinez posted on X, referring to Dune Analytics data. With such a wide range of offerings, the market has changed dramatically.

Related: ‘Bitcoin Reserve or Nothing' — Ripple Slammed for Pushing Multi-Asset Reserve

Supply over demand

Echoing this sentiment, economist Alex Kruger pointed out how the supply of tokens could affect market behavior.

“Too many signs. Infinite more to come. The supply of tokens exceeds demand. All of this shows why it is wrong to expect an ‘altseason' where everything goes longer, Kruger wrote in X. He predicts that Alt seasons will be shorter in the future, “a few days to a few weeks at most.” ”

Krueger also points to challenges for investors, saying that having too many options makes effective portfolio management more difficult.

“Being a good coin picker is very difficult now. Just like being a good stock picker is hard.”

Anonymous crypto trader Ash Crypto has raised concerns about the depletion of the altcoin market, blaming the proliferation of memecoins and low-quality tokens.

“The market is diluted. […] Exchanges [are] Listing only memes to capture volume and grow their user base. Retailer buys these memories and [is] It dropped 80% in one week and then left,” he criticized the behavior of crypto exchanges.

Meanwhile, CryptoQuant CEO Ki Young Joo, comparing altcoins to Bitcoin, said, “There will only be a few altcoin projects with strong use cases and narratives.

Bitcoin has doubled its market cap to $2.07 trillion since 2021, while the total altcoin market capitalization remains at $1.6 trillion, 15.8% below the all-time high of $1.9 trillion reached in December 2024's short rally.

Institutional demand can drive selected altcoins.

However, not all analysts are bullish on altcoins.

Michael van de Pop predicts that some utility-focused coins will attract institutional interest, “I think we'll see true utility coins gain attention as institutional interest grows.”

Van de Pop went on to say that Ethereum could lead the next rally, describing ETH as “the most hated rally of 2025.”

Magazine: Solve crypto's janky UX problem. You haven't noticed yet.