Reddit user says classic altseason is over due to liquidity shift

A Reddit user has argued that a classic "altseason" is unlikely to return due to a structural shift in the cryptocurrency market's liquidity. According to the post, prior to 2022, funds from retail investors flowed into exchanges and on-chain ecosystems, cycling from gains in BTC and ETH into small and mid-cap altcoins. However, the user explained that capital now primarily enters the market through regulated financial products such as ETFs, corporate treasuries, and custodial institutions. This institutional capital does not rotate into arbitrary altcoins, making a market-wide rally where hundreds of tokens rise simultaneously less likely than in the past. The user also pointed out that liquidity has become even more fragmented due to the explosive increase in the number of tokens since 2021 and the dominant role of AI, bots, and MEV in market participation.