Original Article Title: Altcoins Look Dead. That's the Setup.
Original Article Author: @arndxt_xo
Original Article Translation: zhouzhou, BlockBeats

Editor's Note: Bitcoin continues to hit new all-time highs, attracting significant institutional buying and driving a structural price increase. DeFi is accelerating the integration of AMM and the money market, achieving dual asset utilization and improving capital efficiency. Cross-chain liquidity layers are becoming more flattened, enhancing user experience. Stablecoin yield competition is fierce, with increased institutional yield demand. At the same time, airdrops for points and identity verification have become new user growth tactics. The NFT market is weak, with more funds flowing into Memes with practicality and incentive mechanisms, while the ecosystem is gradually evolving.

The following is the original content (reorganized for easier reading comprehension):

Altcoins look completely dead, which is exactly how the market sets up, playing to its strengths: testing your belief.

Altcoins have continued to fall compared to Bitcoin, with Bitcoin's market dominance hovering around cycle highs, and market sentiment torn between the boredom of waiting and the aggressive desire for low-cap coins. This is not a signal for an imminent altcoin bull run, so avoid blindly panicking and following the trend.

We Are Still in a Bull Market

Bitcoin is still the protagonist. From ETF inflows to corporate fund allocations (GameStop, Trump Media, Strive), institutional confidence maintains the Bitcoin engine's firepower.

This is also one of the reasons for the weak performance of altcoins, as Bitcoin seizes liquidity. Ethereum and large-cap coins will not start until this narrative cools down, let alone low-cap coins.

The altcoin season will start after Bitcoin dominance clearly recedes — not while it is still consolidating at cycle highs.

Cycles are Important, Market Structure is Equally Significant

Indeed: the crypto market roughly follows a 4-year rhythm, driven by Bitcoin halving, liquidity conditions, and technology adoption cycles. If you look from a broader perspective, 2025 looks like the latter half of this game, precisely when a parabolic market begins to emerge.

But this stage also sees frequent fakeouts. In 2021, altcoins surged after outperforming Bitcoin on Ethereum. And now? Ethereum still appears weak against Bitcoin. If you rush to buy low-cap coins before Ethereum reverses, you are too early and exposed to risk.

A smarter approach is to build strength. Focus on which large-cap coins are truly accumulating (such as $AAVE, $UNI, $LINK).

Better Short-Term Opportunities, but Not Yet Confirmed

Traders are right to focus on key ranges. Breaking above the range high could trigger a rise in high-risk meme coins. But the operation must be disciplined:

→ Use Bitcoin as a trigger signal, not a direct trading target.

→ Choose low-risk bets on spot meme coins with clear trends like $HYPE, $AAVE, $CRV.

→ Pay attention to Ethereum's performance against Bitcoin; without Ethereum's strength, there is no real meme coin season. It's that simple.

You Won't Make 200x Overnight

True asymmetric returns come from getting in early and investing enough funds in narratives that truly accumulate value:

· On-chain perpetual contracts (Hyperliquid, Virtual)

· Ethereum long-term protocols with real cash flow

· DeFi projects with actual buybacks (AAVE)

· On-chain native winners (Base, Solana, BNB—still not small caps)

The sequence to start the meme coin season is: Bitcoin hits new all-time high (completed), then Ethereum breakout (pending), large caps surge (showing signs), mid caps follow, and finally small caps skyrocket.

We are probably now between the first and second stages.

Be patient and accumulate on pullbacks.

Weekly Updates

· Capital efficiency is the new arms race AMMs (Automated Market Makers) and money markets are merging: EulerSwap's "LP as Collateral" model and Hyperdrive's "Loan vs Investment Portfolio" concept are pointing toward a future where "idle liquidity is unacceptable." Strategic advice: Emphasize this fusion in your content — "every asset should yield dual returns."

· Bitcoin DeFi moving from narrative to utility Mezo's Bitcoin-backed MUSD and the acceptance of cbBTC in Liquity's fork show that developers are finally treating Bitcoin as useful collateral, not just digital gold. If your audience cares about returns, you can describe Bitcoin as the "new U.S. Treasury bond of the crypto world" — secure collateral that generates revenue.

·Hooks and Modular Infrastructure The hooks (Gamma) of Uniswap v4 and Bittensor's Uniswap port on EVM showcase how permissionless extensibility is driving the convergence of decentralized exchanges (DEXes) with centralized exchange (CEX) features. From a content perspective, it is anticipated that custom trading interfaces will surge — position your tweet as "Why hooks have turned every DEX into a platform".

·Cross-chain Liquidity Layer Trending Towards Confluence Malda's cross-chain lending, Katana's VaultBridge, and Starknet's USDC-to-Bitcoin bridge all opt for native abstractions over the traditional bridging user experience. A noteworthy trend: liquidity is no longer concerned with "which chain." Content suggestion angle: "The chain wars truly end when users don't see the chain anymore".

·Intensifying Stablecoin Yield Wars From TermMax's 19% yield to Ripple's RLUSD incentives, and then to Pendle's 20x multiplier, the DeFi landscape of fixed-income styles is rapidly maturing. Targeting ultra-high net worth clients (e.g., Libertas), emphasize "institutional-grade yields, no custody compromises".

·Points, Tasks, and Airdrops Still Key to Growth Lagrange's verifiable AI tasks and Humanity's palm-vein access hint at reward systems resistant to Sybil attacks. In marketing, advocate for a shift towards "identity verification airdrops" to differentiate from the rampant indiscriminate airdrop activities.

·RWA and Institutional Bridges Continuing Expansion Curve's Plume, Origin's revenue buyback, and Ripple's RLUSD are all integrating traditional financial mechanisms into DeFi infrastructure. The asset-backed narrative continues to attract attention — highlight transparency and real yields in your RWA content.

Narrative Overview Bitcoin is hitting new all-time highs, yet the sentiment of most crypto traders appears unusually fatigued. This split sentiment is understandable: almost all charts that retail investors are obsessing over are for altcoins, most of which have been range-bound for months. With summer approaching, traders are accustomed to thin order books and sudden sell-offs, making Twitter timelines full of tension.

Treasury Gold Rush

We seem to be back in 2020. In the past week, GameStop, SharpLink, Strive, Blockchain Group, and even Trump Media together allocated over $3 billion for direct Bitcoin purchases. Their logic is simple: with cash depreciating by 5% in real terms and long-term bonds barely preserving value, Bitcoin is the only mainstream liquid asset that has outperformed inflation in the last five years.

This asset migration has a significant impact:

Firstly, it absorbs spot supply, much like the ETF inflows at the beginning of the year, making each additional Satoshi more difficult to acquire.

Secondly, it sets a risk benchmark for fund managers: "If a retailer known for meme stock hype can allocate 5% to Bitcoin, why can't we?"

It is expected that this will transform previous cyclical rebounds into a more structurally slow upward trend. Ironically, the better Bitcoin performs, the more likely the altcoin season will be delayed; while there are signs of a peak in dominance, the true hodlers are CFOs, not retail traders who frequently change positions.

Capital Efficiency War: AMM Swallows the Currency Market

As financial officers continue to buy into Bitcoin, DeFi designers eliminated the boundaries between exchange, collateral, and fixed income in May.

Euler integrated Uniswap-v4 hooks into its lending engine, making LP tokens automatically collateralized for loans—instant liquidity, no idle TVL. Hyperdrive allows Hyperliquid traders to use USDe or USDT0 as leverage to collateralize perpetual contracts, while Malda's ZK-driven "borrow-as-you-go" layer turns cross-chain bridges into a user experience detail.

The implication is that any asset in a smart contract should serve dual purposes: one for exposure and one for yield. This makes protocol users stickier, professional arbitrageurs compress spreads, and reduce risk by aligning with real-world assets.

Liquidity Migration: The Quiet Rise of Layer-2

Hyperliquid's TVL climbs each week, Base's trading volume steadily grows in the Virtual ecosystem, and BNB Chain DEX data explodes (Polyhedra's growth is mainly due to bot wash trading competing for ZK points). Etheruem remains the capital flow hub, but the flows are towards: AAVE, UNI, LINK, PEPE, and other high-market-cap tokens. The retail farming sell-off season has shifted to layer-2, and the mainnet has become the main street.

Meme Velocity, Buyback, and Beta Hunt

AAVE's governance-driven buyback has turned the token into an institutionally favored accumulation asset, bringing in the cleanest spot inflows since the spring. The meme has split into two camps: the "rotation leaders" open to institutional involvement (PEPE, VIRTUAL, SPX6900) and the "abandoned votes" driven by retail speculation (DINNER, Fartcoin), until the music stops.

An interesting phenomenon: capital flows on Solana are more diversified—MEW's Robinhood listing, JUP's continuous faucet, and potential gems like BRETT, KAITO are attracting attention. If you produce growth content, emphasize this fragmentation to differentiate from the Ethereum-centric narrative.

NFT: The Forgotten Frontier

As ordinal heat fades, trading volumes plateau, and even the "whales" struggle to support the floor price. Without new loose policies in place, or without a new narrative that reframes JPEGs as practical tools rather than showpiece assets, funds previously chasing NFTs have shifted towards Memes with a built-in scoring system.

"Original Article Link"

Welcome to join the official BlockBeats community:

Telegram Subscription Group: https://t.me/theblockbeats

Telegram Discussion Group: https://t.me/BlockBeats_App

Official Twitter Account: https://twitter.com/BlockBeatsAsia