Why Are Altcoins Underperforming Despite Numerous Positive Developments? What Is Preventing the Arrival of Altcoin Season? Insights from a Senior Executive.

Despite Wall Street’s growing embrace of cryptocurrencies and regulatory change under President Donald Trump, altcoins continue to struggle, according to Matt Hougan, chief investment officer at Bitwise Asset Management.
Hougan described the current crypto investment environment as one of the best in history, citing decreasing regulatory threats and increasing institutional adoption. However, he noted that individual sentiment remains at one of its lowest points ever, with altcoins underperforming despite Bitcoin’s strong rally.
Bitcoin has surged nearly 90% in the past year, largely driven by inflows into spot Bitcoin ETFs, but Hougan observed that most altcoins have failed to keep pace, with a few exceptions like Solana and XRP.
“The average crypto asset has been shattered,” Hougan wrote, highlighting a key challenge: the lack of a major new application that would drive altcoin adoption.
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The ICO boom in 2017 sparked a massive bull run. The rise of DeFi applications fueled altcoin gains in 2020. Today, Hougan argues that while the memecoin boom generated excitement, it lacked the fundamental innovations needed to sustain long-term growth.
Despite the current slump, Hougan believes the foundation for an altcoin resurgence is stronger than ever. One key factor, according to the analyst, is regulatory clarity. While he did not name former SEC Chairman Gary Gensler, Hougan pointed to the leadership changes at the Securities and Exchange Commission (SEC) as a major positive change. He suggested that altcoins will soon emerge from the “regulatory gray zone” that has hindered growth over the past four years.
Additionally, stablecoins have become a national priority, which Hougan sees as a bullish catalyst for Ethereum and Solana. At the same time, he noted, institutions are starting to develop crypto applications that will bring DeFi to the masses, further strengthening the long-term potential of the sector.
While Hougan is reluctant to predict what exactly will trigger the next alt season, he is convinced one is coming. “In a year or two, I predict you won’t have to squint to see the transformation in alts; the impact will be obvious. And it will be overwhelming,” he wrote.
*This is not investment advice.*