I noticed an interesting paradox in the market. Bitcoin increased by only 1.15% in a day, while some altcoins skyrocketed several times. At first glance, it makes sense — altcoins are always more volatile. But when the difference in growth is dozens of times, something else is clearly happening.
Let's figure it out. The altcoin season index is currently 34, and Bitcoin's dominance holds at 58.5%. Both indicators suggest we're still far from a true altcoin season. But here’s the paradox — in conditions where there is no altcoin season, certain tokens move as if it has already arrived. Why?
Because from December 2024 to April 2026, the total market capitalization of altcoins (excluding BTC and ETH) fell from 1.16 trillion almost to 700 billion. That’s a 40% drop. It sounds like a discount, but it’s not a sale — it’s vulnerability. When the market halves, the entry threshold for control drops tenfold. Less money is needed to influence the price.
Taking SIREN as an example. At the end of March, the token surged sharply, but then analysts found that one entity controls up to 88% of the circulating supply. That was about $1.8 billion. When the information spread, the price dropped from $2.56 to $0.79 in a day — a 70% decline. The current SIREN price is $0.73. Even by conservative estimates, 48 wallets hold about 66.5% of the circulating supply. Small investors thought they were participating in a free market, but in reality, they entered a container with a pre-planned exit strategy.
This is not an exception. For heavily fallen altcoins, this is the norm. The deeper the fall, the less capital is needed to seize control. A systemic 40% drop means this vulnerability has spread across the entire market.
There’s another layer to this story — short funding. When SIREN was rising, the funding rate dropped to -0.2989% every 8 hours. That’s roughly -328% annually. Shorts pay longs 0.3% of capital every 8 hours. Over a month, this can eat up more than 25% of the principal, even if the price doesn’t grow. On small altcoin markets, such rates are not uncommon. Some tokens reached -0.4579% in 8 hours, which is about -501% annually.
A chain reaction works here. Price increases cause unrealized losses for shorts. When losses reach the margin call level, the system automatically closes positions at the market price. This forced buying pushes the price even higher, triggering new liquidations, launching the next wave. On low-cap, thinly liquid markets, each trade causes significant price movement. The efficiency of this chain is much higher than on larger markets.
This creates asymmetry. When a token rises by 90%, it seems logical to open a short, expecting a correction. But you’re not just fighting the price movement — you’re also paying hourly funding fees and dealing with the liquidation chain reaction. This game is inherently asymmetrical. Extremely negative rates indicate that the ammunition is loaded.
Now, the main point. The trading volume on DEXes on BSC increased by 97% year-over-year over the week. It sounds impressive. But this is an accelerated turnover of existing funds, not an influx of new money. Institutional fund movements confirm this. In early April, net inflow into the Solana ETF dropped to zero. The XRP ETF continues to show outflows. Ethereum ETF received $120 million, but the day before, there was a $71 million outflow. The overall picture is anticipation, not a switch.
This is very different from 2021. Back then, Bitcoin’s dominance fell from 70% below 40%, and the altcoin season index exceeded 90. It was a comprehensive rise supported by excess liquidity and mass retail investor entry. Today, 34 and 58.5% — it’s a completely different picture. The machine is just starting to warm up.
An important point — institutional funds via ETFs follow asset allocation logic, not crypto market emotions. They adjust their Bitcoin positions to a certain percentage, but don’t rush into altcoins because it’s hot. These funds won’t automatically flow into altcoins without a clear directive. In 2021, retail investors went where the heat was. Now, the anchor is institutional funds with a fixed path.
A 97% increase in volume is indeed a revival. But a market without new money is a zero-sum game. One’s profit is another’s loss. The pool isn’t growing. The revival belongs only to those already inside. Those who come later usually end up withdrawing others’ assets.
Returning to the beginning. BTC rose 1.15% in a day to $77.32k, while several altcoins grew several times. These are two different stories. The Bitcoin rise — macro conditions pause, institutional funds test levels. The explosive growth of altcoins is the result of ultra-low capitalization after the fall, structural vulnerability, small capital in low liquidity conditions, and extremely negative financial rates that turned shorts into fuel for longs.
By historical standards, this machine hasn’t even warmed up yet. Bitcoin dominance should fall to 39%, institutional funds should shift to a diversified portfolio, and new money should flow continuously. None of these points will be resolved with a 10% rise.
There are two types of people in this machine. One knows who it’s working for. The other is fuel. Bitcoin’s growth is a signal; sharp altcoin rises are echoes. By distinguishing these two phenomena, you can make a choice not predetermined by the machine.
