Altcoin Market Faces Significant Decline Over the Past Year
Over the past year, the altcoin market has experienced a notable downturn, underperforming Bitcoin amid heightened volatility and shifting investor sentiment.
Data shows that a broad range of mid- and small-cap tokens recorded double-digit losses, as liquidity tightened and risk appetite weakened across the crypto market.
Several factors contributed to the decline. Rising macroeconomic uncertainty and a stronger U.S. dollar reduced capital inflows into higher-risk assets, while regulatory developments in key markets added pressure to altcoin valuations. At the same time,
Bitcoin dominance increased, reflecting a rotation of funds toward relatively lower-risk large-cap assets.
On-chain metrics indicate reduced trading volumes and slower ecosystem growth for many altcoin networks, with some projects seeing declining active addresses and developer activity.
Despite this, infrastructure-focused sectors such as Layer-2 solutions and real-world asset (RWA) tokenization showed relative resilience.
Market participants continue to monitor signs of stabilization, including improving liquidity conditions and renewed interest in select high-utility projects.
While short-term pressure remains, analysts note that historically, periods of extended altcoin weakness have often preceded selective recovery phases as market conditions improve.
Disclaimer: This content is for informational purposes only and does not constitute financial advice.
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