The bull run is coming, why are alts lagging behind?

Introduction

Against the backdrop of Bitcoin reaching a historic high and Ethereum's monthly increase exceeding 40%, the crypto market has rekindled expectations of a bull run. On-chain capital activity has rebounded, trading platform activity has clearly risen, and macro signals are also showing a favorable trend.

However, when investors check their wallets, they find that alts seem to be stagnant ------ is this still the familiar bull run?

1. Did alts really miss the bull run?

As of May 22, 2025, the price of Bitcoin has exceeded $110,000, setting a new historical high; Ethereum has risen over 45% in the past month. In this wave of renewed sentiment, funds and flows are concentrated in mainstream assets. In terms of the macro environment, the global trade environment is improving, and the risk appetite for funds is rising, providing a good upward channel for the entire crypto market.

However, against this backdrop of positive news, the small-cap token sector is overall sluggish. Most alts have not only failed to rise but have continued to retrace. The enthusiasm for Bitcoin and Ethereum is masking a certain directional shift occurring in the entire market: alts are not without activity, but are being consciously "excluded" by capital and users.

Why does this bull run seem to belong only to mainstream coins? Has the value logic of altcoins collapsed? Or do they need a new survival strategy? This article will analyze the challenges and solutions faced by altcoins behind this structural bull run from several dimensions: macro environment, funding preferences, user mindset, and mechanism innovation.

2. Macroeconomic Environment Analysis: Is the Bull Run Really Here?

1. Improvement in trade environment and recovery of risk appetite

By mid-May 2025, the macro market's main tone has undergone a significant shift.

The global trade environment has significantly improved, with major economies issuing a joint statement after the Geneva trade talks, stating that they will substantially reduce tariffs. This move has not only sparked optimistic sentiment in the market but also released a positive signal against inflation.

As a result, the US stock market has entered a structural upward channel. The S&P 500 index has risen from 4,800 points at the beginning of the year to 5,940 points (as of May 20, 2025), approaching a historical high. There is a clear increase in risk appetite for funds, with the Nasdaq and large tech stocks all rising, while signs of fund outflows have appeared in gold and government bonds.

At the same time, the crypto market has also benefited significantly. According to data, since March, the net inflow of funds into crypto assets dominated by Bitcoin has reached $9.3 billion, with most concentrated in the spot market. Notably, trading activity in the Eastern Time zone has significantly increased, indicating a trend of substantial US capital entering the market.

2. The mainstream coins continue to rise.

Bitcoin broke through $110,707 during intraday trading on May 22, 2025, reaching an all-time high; Ethereum has shown strong momentum since April, rising to around $2,629 as of May 22, entering the "key area" for breaking through $3,000.

3. Do mainstream coins become a "safe haven" for funds? This reflects a "preference for certainty" behind it.

• Regulatory expectations are clearer: Bitcoin and Ethereum have stronger compliance attributes, and regulatory agencies are gradually clarifying their classifications;
• Better liquidity: Large institutions continuously absorb Bitcoin through spot products or custody services;
• More complete narrative: Bitcoin finance and the Ethereum layer two network ecosystem have recently become the center of a new round of discussions.

This allows mainstream coins to gain excessive premiums in the new market cycle, while altcoins fall into the marginal funding zone.

4. The overall trend of alts is flat.

In contrast, the performance of the small-cap token sector is clearly inferior.

Except for a few narrative hotspot projects like AVAX and NEAR which saw slight increases, most small-cap alts did not rebound alongside the mainstream coins and even experienced pullbacks, with funds further concentrating on mainstream coins.

5. The market is not "out of money", but rather "unwilling to take risks"?

On-chain interaction data shows that the entire market is not lacking liquidity, but rather that liquidity is extremely skewed. Buying pressure is concentrated on Bitcoin and some high-profile projects, while altcoin trading depth continues to decline. The search volume for Bitcoin and ETFs has surged.

The bull run in the market has indeed returned, but it seems to belong only to Bitcoin and not to small market cap alts.

3. Why haven't alts kept up?

1. Users' mindset has matured: The cycle of chasing highs and selling lows is over.

During the bull run in 2021, a large number of retail investors entered the market due to the chasing-up sentiment, blindly chasing various new coin projects, and ultimately most were deeply trapped in the periodic collapse of alts. According to reports from data analysis agencies, by the end of 2022, over 73% of non-mainstream coin investors were in a loss position after holding for 6 months.

After the market rotation, by 2025, investors generally developed a more cautious trading mentality:

• Value the actual number of users and on-chain activity of the project more.
• More inclined to choose projects with innovative mechanisms, clear airdrop mechanisms, and ecological support.
• No longer easily "listening to orders" or blindly going all in.

On-chain interaction data shows that the median participation (7-day active addresses) of small-cap token projects after launch has fallen from over 13,000 in 2021 to currently less than 2,800, and the community enthusiasm is visibly cooling.

Users are not avoiding the market, but rather choosing to "wait smarter."

2. Transformation of Influencer Behavior: From "Shouting Long" to "Arbitrage"

In the past, altcoin projects heavily relied on opinion leaders and community dissemination. Opinion leaders converted traffic into price through early accumulation, live calls, and video content. However, in 2025, with various tracks and popular projects gaining traction and changes in project airdrop strategies, opinion leaders began to shift more from "content distributors" to "manipulative orchestrators."

By observing the opinion leaders active on social platforms, it is not difficult to find that: they already have a certain proportion of tokens pre-allocated before promoting the project; after the community release, they gradually sell off on trading platforms to profit; and there are obvious records of "pump and dump" behavior.

Especially in the recent "popular projects" of a certain public chain ecosystem, opinion leaders frequently participate in the "airdrop farms + group chat distraction" strategy, resulting in an increased probability of losses for ordinary users.

In the long term, this behavior is accelerating the destruction of the trust foundation of alts.

3. Sector heat transfer: Narrative can't compete with Bitcoin finance, AI, and re-staking.

The data report indicates that the current cryptocurrency narrative is focused on the following three tracks:

• Bitcoin Financial Ecosystem
• AI-related projects
• Ethereum staking again

However, traditional small-cap altcoin projects lack connection with mainstream narratives, have thin narratives, no technological breakthroughs, and scarce ecological cooperation, making it difficult to gain new traffic attention.

The focus is no longer on "all coins can rise," but rather on capital and users concentrating on "investing in the right story."

4. Market trust and liquidity structure are being rewritten.

The trust mechanism of alts is collapsing:

• Users no longer trust project parties: Most projects are only active in the initial 30 days after launch, and then liquidity dries up.
• Decreased interest from market makers: Market strategy institutions are concentrating resources on mainstream coins and compliant stablecoins, while altcoin trading pairs have been delisted by multiple trading platforms.

A more serious problem is that the lack of consensus has led to the "hollowing out" of the community: project teams are left with only operational accounts and no real community; retail investors are flowing into points systems, airdrop hunter channels, and even AI mining.

This has also led to a new phenomenon------alts are no longer about "foolish speculation", but rather "quick profits": no one believes in long-term investments, and everyone is scrambling for short-term liquidity.

The lack of growth in small-cap tokens is not because no one is paying attention to them, but because there is no longer a reason to believe in them.

When the incentive design of the project party is no longer sustainable, the credibility of opinion leaders cannot be established, and the user's game theory is left with only the "running away mechanism," the entire altcoin ecosystem loses its basic trust and liquidity support structure.

The next step is to redesign this system, rather than repeating the old routine.

4. The Rise of New "Altcoin Play"

1. Airdrop and Points Mechanism Driven by Trading Platforms

Against the backdrop of declining user enthusiasm, some trading platforms have implemented task systems, points redemption, and airdrop activities to rekindle user engagement. In addition, some projects have also begun to introduce a points multiplier mechanism in an effort to incentivize long-term user participation and enhance community activity. The core of these mechanisms lies in:

• Lower the participation threshold: Rewards can be obtained through simple tasks, attracting more users to participate.
• Enhance user engagement: The points and airdrop mechanisms encourage users to continuously participate in the project ecosystem.
• Expand community influence: The referral mechanism encourages users to actively promote the project and increase its influence.

2. Launching at its peak? The sustainability of popular projects is being questioned.

Popular projects are showing stronger community-driven characteristics in 2025. Project teams quickly gather popularity through social media, community activities, and viral content dissemination. Before the coin is listed on trading platforms, they usually attract market attention rapidly through social media in a short period of time; after the coin pair goes live, the price quickly rises and then rapidly pulls back. Its sustainability is under scrutiny, and the market is calling for project teams to continuously optimize aspects such as security, governance structure, and community building.

5. Future Outlook: The Breakthrough Path of Alts

1. Alts need skin changes vs soul changes: Repackaging old projects or reconstructing mechanisms?

Whether altcoins still have a chance does not depend on the market conditions, but on whether they can "self-update".

In the past, many projects went silent during bear markets and then "resurrected" at the beginning of a bull run: changing a logo, updating a roadmap, and adding some AI keywords to start telling the story again. But users in 2025 are no longer easily fooled by "new wine in old bottles."

Compared to "skin-swapping", truly competitive projects have chosen "soul-swapping": reconstructing token economic models, introducing fairer airdrop mechanisms, and even guiding community co-governance through decentralized autonomous organizations, transforming users from speculators into co-builders of the ecosystem. At the same time, by relying on an extremely simple user experience and deeply binding on-chain native traffic, they have achieved sustained activity and liquidity.

The key to breaking through is not how trendy the packaging is, but whether the mechanism is new enough, the emotions are genuine enough, and the pace is steady enough.

2. What do retail investors really need? Narrative? Practicality? Or pure speculation?

In 2021, retail investors pursued narratives and the realm of imagination.

In 2025, retail investors are more concerned about "Can I try and error at low cost?", "Can I sell at any time?", "Am I being treated as a counterparty by the project party or opinion leaders?"?

They do not need a "grand vision"; what they need is clear expectation management and quick feedback.

This also means that the project team must redesign the user participation path:

• The mechanism of tasks, points, and NFT binding cannot solely rely on "incentives"; the "exit cost" must be incorporated into the design.
• Instead of pursuing explosive user growth, we aim to establish a small yet refined "core loyalty pool";
• Let users feel that they are not "being designed" but instead "participating".

3. How can project teams, platform providers, and communities rebuild user trust?

The current market has two growth engines:

• Traffic system driven by the trading platform: The trading platform is reconstructing the "task → incentive → airdrop → listing" user traffic path. This is not only a cold start tool for projects but also a "sandbox" for controlling traffic risks.
• Community-driven new narrative system: social platform fission, decentralized autonomous organizations for creators, and low-threshold opinion leader incubation tools have become the infrastructure for the autonomy of alts traffic.

If the previous traffic strategy was "overwhelming", the current approach resembles "igniting a spark": allowing early believers to engage, earn money, and generate real transactions and content, which may lead to viral growth and organic dissemination.

Summary: alts have reached a time for reshuffling.

Alts haven't disappeared; they have just gone through a reshuffling.