Altcoin Season Index Hits January High — Is Altseason Finally Returning?

Altcoin market capitalization (TOTAL2) has climbed back above $1 trillion. It closed the second week of March with its first green weekly candle after seven consecutive red weeks.

At the same time, the Altcoin Season Index has returned to the level seen at the beginning of the year. This development has raised hopes for an altcoin season in March, despite ongoing geopolitical tensions.

Several analysts identify additional factors that could support an altcoin season. However, capital flows currently appear to concentrate on only a few specific narratives.

Altcoin Season Index and Tether Dominance (USDT.D) Suggest a Potential Altseason in March

At the start of the third week of March, the Altcoin Season Index rose to 49 points. This level is at its highest since January 9.

The index still remains far below the 75-point threshold required to officially confirm an altcoin season. Even so, the sharp rebound from its recent lows suggests that investors are becoming more willing to allocate capital to altcoins.

Altcoin Season Index. Source: BlockchainCenter

During the same period, the dominance of the stablecoin Tether (USDT.D) has begun to show a clear bearish signal.

USDT.D measures the share of USDT within the total crypto market capitalization. When this metric declines, it often indicates that investors are spending USDT to purchase altcoins.

Analyst Gordon examined the 4-day chart of USDT.D and detected a bearish MACD-H crossover. Historical data shows that this signal has repeatedly predicted short- and medium-term altcoin recoveries.

“USDT.D bearish cross has happened. Liquidity will now flow into BTC and alts again,” analyst Gordon predicted.

Tether Dominance and MACD-H Indicator. Source: Gordon

Crypto analyst Michaël van de Poppe also expects altcoins to rise strongly in the near future. He believes prices could increase by 20–40%.

However, selecting the right altcoins has become extremely difficult. The market now contains more than 37 million tokens. Investors must conduct careful research, analyze trends, and avoid the risks associated with low-quality projects.

At present, tokens related to artificial intelligence (AI) stand out the most. Data from CoinGecko shows that AI Coins lead altcoin performance. The sector has recorded an average gain of 19% during the first two weeks of the month.

Major Crypto Sectors Performance. Source: CoinGecko.

Recent reports from BeInCrypto also highlight several AI-related tokens attracting investor capital in March. These include Bittensor and NEAR Protocol, both of which currently have their own catalysts driving attention.

The next narrative delivering standout performance is exchange-based tokens. Among them, Hyperliquid (HYPE) is gaining momentum from the HIP-3 catalyst, while OKB is rising on news of an ICE investment.

Despite these positive signals, the broader market sentiment remains fragile. The Fear and Greed Index still sits in the “extreme fear” zone. At the same time, military tensions in the Middle East continue, with no clear signs of easing.

As a result, any altcoin recovery may remain limited and struggle to sustain momentum amid persistent risk-off sentiment.