Hyperstition #13 — May 19, 2025
Wen memecoin season?
Wen memecoin season?
Technical indicators suggest altseason is imminent.
Memecoins are already breaking out.
Large cap memes are expected to rally; smaller caps will also benefit.
Bitcoin dominated cryptocurrency markets in the first half of 2025, but altcoins are finally poised to rally. Expect memecoins to outperform.
After peaking in early May, Bitcoin Dominance — a measure of Bitcoin’s contribution to crypto’s total market capitalization — has declined. Meanwhile, sidelined capital has been rotating into altcoins.
Analysts say these are signs that crypto may be entering its next altseason, a period when altcoins outperform Bitcoin.
“Bitcoin dominance has peaked. The end of the bear market for #Altcoins,” Michaël van de Poppe, founder of MN Fund, a crypto investment fund, said in a May 12 X post.
This is especially bullish for memecoins, which offer “explosive upside when risk appetite surges,” according to an April 8 report by asset manager 21Shares.
Has altseason begun?
After hitting a cyclical peak of more than 62% on May 7, Bitcoin Dominance has declined to less than 61% as of May 18, according to CoinStats.
The reversal is still nascent, but analysts expect the trend to continue.
Since April 10, stablecoin Tether’s (USDT) dominance has declined from around 6.2% to 4.6%, according to data from TradingView.
Meanwhile, TOTAL3 — a measure of all cryptocurrencies except Bitcoin and Ether — has gained approximately $200 billion in market cap since late April, the data shows.
Together, these metrics suggest sidelined capital has started rotating into altcoins.
“[T]he liquidity is going into alts. This is why BTC dominance is… dropping along with USDT dominance,” crypto analyst Ito Shimotsuma said in a May 12 X post.
Memecoin outperformance
Memecoins are already breaking out.
In the past 30 days, memecoins’ cumulative market cap has gained roughly 56%, almost twice as much as the broader crypto market, according to data from CoinMarketCap.
Research suggests they are just getting started — particularly larger cap coins such as DOGE, Shiba Inu (SHIB), and Pepe (PEPE).
These memecoins have “endured not because of hype cycles but because they represent something deeper: tokenized internet culture, forged through shared humor, sentiment, and identity,” 21Shares said in an April 3 report.
For instance, DOGE has “shown remarkable structural resilience,” outperforming Bitcoin by roughly 1000x over the past decade, the asset manager said.
Now, “[a]s macro uncertainty continues to fade and momentum returns to the market, retail participation is likely to accelerate, setting up conditions in which Dogecoin has historically thrived.”
Smaller cap memecoins are also benefitting from the altcoin revival.
Since May 1, memecoins’ daily average trading volume has surged by around 30%, according to data from Dune Analytics. Coin creations are also rebounding from March lows, the data shows.
“We just experienced 2-4 months of 200-500k toppers, with the SELECT FEW making it out ABOVE 10-20m at the time,” crypto influencer TraderPow said in a May 14 X post.
Now, “[w]e're seeing multiple 7-8fig coins… and seeing massive volume,” he said.
Nothing in this post constitutes investment advice, financial advice, or any other kind of advice. The content is for informational and educational purposes only. Always do your own research and consult a professional before making any decisions.
By the numbers…
