Institutional Shift to Altcoins Signals Potential Altcoin Season

The institutional shift towards altcoins began as a deliberate strategy by pioneering firms like MicroStrategy, which started diversifying their treasury holdings beyond Bitcoin into notable altcoins. Typical examples include:

• Ethereum: Institutional confidence in Ethereum’s ecosystem is exemplified by major holders like ShareLink (Nasdaq: SBET) and Bitmine (NYSE: BMNR) . ShareLink has accumulated a total of approximately 358,000 ETH, while Bitmine Immersion holds a treasury of 300,657 ETH.

• XRP: Ripple and its institutional backers are leading XRP adoption, holding an estimated 1.5 billion XRP tokens in treasury.

• Solana: Upexi (NASDAQ: UPEX), a leading publicly traded company, recently completed a $150 million convertible note offering, doubling its Solana treasury to approximately 1.65 million SOL tokens.

This approach, often dubbed the “infinite money glitch,” involves raising capital through debt or equity issuance to buy cryptocurrencies. As these early movers saw stock price appreciation and crypto asset growth, other firms began to emulate the strategy, creating a powerful flywheel effect.

The Infinite Money Glitch, Source: Animoca Brands Research

The benefits of this flywheel are already visible. A quick look at the return charts reveals that in the short term, this altcoin treasury strategy has paid off handsomely for the pioneering firms and their shareholders. Beyond diversifying risk from Bitcoin’s volatility, this trend capitalizes on growing institutional interest and positions companies at the forefront of crypto innovation and financial growth.

Bitcoin Dominance Declines as Altcoin Volumes Surge

Bitcoin’s market dominance has fallen to its lowest since March 2025, while altcoin trading volumes have surged — a classic signal pointing to an impending “altseason.” Data indicates institutional capital is rotating out of Bitcoin, with ETF inflows slowing, and moving into altcoins such as Ethereum, Solana, and XRP. This trend is evident through increased whale transactions and stablecoin deposits into altcoin-focused exchanges.

This shift is partly fueled by a clearer regulatory environment in the U.S., where the House of Representatives passed the Clarity Act and the GENIUS Act in July 2025. These bills establish a robust framework for crypto markets and stablecoins, boosting corporate confidence in altcoin investments.

Dirk Willer, Citi’s global head of macro, asset allocation, and emerging market strategy, remarked, “The regulatory backdrop has supported prices, and attention has turned to Bitcoin’s role in portfolios, with some likening the crypto asset to ‘digital gold.’ However, this moniker is likely premature,” reflecting cautious optimism around altcoins.

Risks and Opportunities in the Altcoin Surge

While the pivot to altcoins points toward a potential altseason, significant risks remain. The “infinite money glitch” strategy — relying on debt-financed crypto purchases — exposes companies to market volatility and rising debt costs.

Despite these challenges, the altcoin market’s total value has swelled to $3.67 trillion, fueled by growing institutional adoption and retail interest in tokens like BNB, FET, and TRX.

Companies such as Metaplanet, which recently allocated $5 billion to its U.S. subsidiary for Bitcoin purchases but is now considering altcoins, highlight the expanding corporate appetite for diversified crypto portfolios.

With Bitcoin’s dominance declining and institutional capital flowing into altcoins, the stage is set for a potential altcoin season. However, investors must navigate this volatile landscape with caution.