In previous cycles, the common scenario was: Bitcoin led first, then rotation began toward alternative coins after Bitcoin's momentum cooled down. The new thing now is that many major coins are moving in sync with Bitcoin, which usually means the move isn't a 'short-term gamble' but rather broader market participation.

1) Liquidity has become 'internal' and rapidly shifting

Stablecoins have become a foundational monetary base within crypto. A Deutsche Bank study notes that the market capitalization of stablecoins jumped from around $5 billion (2020) to over $290 billion (2025), with significant concentration in USDT and USDC.

When liquidity is already 'tokenized,' capital shifts from BTC to ETH/SOL and others within minutes instead of days (bank transfers/deposits). This reduces the 'waiting period' that previously delayed the rise of alternatives.

2) Institutional trust has raised the ceiling and reduced market hesitation

ETFs and institutional demand have brought Bitcoin closer to a macro asset, opening the door for risk distribution across major crypto assets when risk appetite rises. On April 22, 2025, Bitcoin's dominance reached approximately 64% (the highest level since around 2021), amid clear institutional inflows and interest.

And when general sentiment improves, market activity expands across the board rather than remaining confined to Bitcoin.

3) Historically, alternatives have had higher 'beta'—and this is nothing new

If the market enters a 'Risk-on' phase, historically large alternatives have delivered higher returns than Bitcoin:

2020: Bitcoin +270% compared to Ethereum +423%

2021: Bitcoin +73% compared to Ethereum +436%

This makes alignment logical: investors don't wait for Bitcoin to stop if they see liquidity expanding and participation growing.

The true test that quickly exposes the illusion

True expansion must be supported by new net liquidity, not just leverage. The ECB has warned that the stablecoin market has surpassed $280 billion, and about 80% of trading volume on centralized platforms passes through stablecoins; this makes 'racing on stablecoins' risky, potentially forcing the forced sale of Treasury holdings and exporting the shock to global markets.

The idea that 99% overlook: stablecoins are not just 'digital dollars'—they are a channel linking private money creation to global demand for U.S. government debt (Treasuries), creating a 'convenience yield' and increasing the transmission of shocks globally.

If this cycle is a 'healthy expansion,' how can you practically distinguish between expansion driven by real liquidity... and expansion driven by budgets/leverage that will collapse all at once?


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