Altcoins Just Seized 65% of Binance Volume, but One Key Signal Still Says It Is Not ‘Altcoin Season’

Altcoins took a commanding share of Binance trading activity during the latest crypto rally, but the surge has not yet met one widely used threshold for a confirmed altcoin season.

According to an analysis published by CryptoQuant on Aug. 25, altcoins peaked at 65% of Binance trading volume, their largest share in two years. Bitcoin accounted for 21% of volume, while ether represented 13.6%, the analysis found.

Bitcoin’s rally helped pull liquidity back into crypto

The shift came after a sharp bitcoin advance that brought renewed attention to crypto markets. The source report says bitcoin crossed $81,000 on Aug. 25 after gaining nearly 30% during the broader rally period cited by the analyst.

CryptoQuant’s analysis framed the move as a sign that traders were again willing to move further out on the risk curve.

“After a prolonged stretch of low volatility and subdued volume, it’s Altcoins that have captured investors’ attention and capital, potentially signaling a broader resurgence of risk appetite across the market,” the analysis said.

Still, a higher share of exchange volume does not prove that money flowed directly out of bitcoin and into altcoins. Volume measures the value of assets traded, while market capitalization can rise simply because token prices increase.

Altcoin market cap reportedly added $135 billion

CryptoQuant’s analysis said altcoin market capitalization increased by about $135 billion during the same period. The broader crypto market added roughly $500 billion, bringing total market capitalization to nearly $2.74 trillion during the third week of August, according to the source report.

Several altcoins reportedly outpaced bitcoin as trading accelerated. The report cited gains approaching 100% for some tokens, while ether rose 31.2% over seven days.

Those gains came with an important caveat: many assets remained well below prior record prices, meaning the short-term rally did not erase earlier drawdowns.

Why the rally still falls short of altcoin-season confirmation

A separate market benchmark had not confirmed an altcoin season. The Blockchaincenter Altcoin Season Index stood at 37 on Aug. 26, according to the source report.

That index requires 75% of the top 50 eligible cryptocurrencies to outperform bitcoin over 90 days before labeling the market as being in altcoin season.

The latest move also marks a contrast with CryptoQuant’s assessment two months earlier. In June, the firm found that bitcoin-pair altcoin volume had fallen to its lowest level since 2021, with institutional liquidity remaining concentrated in bitcoin rather than spreading widely into smaller crypto assets.

Regulators continue to warn about crypto trading risks

Rapid changes in trading volume and price concentration can increase volatility risk, especially in smaller markets. The Commodity Futures Trading Commission has warned that virtual currency spot markets can face flash crashes, manipulation and limited oversight, and that some platforms may lack critical customer safeguards.

The Securities and Exchange Commission’s Office of Investor Education and Advocacy has also identified volatility, illiquidity, concentrated ownership and limited protections as risks tied to crypto asset securities. That warning applies to crypto asset securities, not necessarily every altcoin.