TL;DR
- The Altcoin Season Index climbed to 49, its highest level since January 9, while TOTAL2 moved back above $1 trillion after seven weeks.
- Falling Tether dominance and a bearish USDT.D MACD-H crossover are being read as signs that liquidity may rotate back into Bitcoin and altcoins.
- AI tokens are leading with a 19% average gain, but extreme fear and Middle East tensions still threaten to keep any altcoin rally selective.
Altcoins are starting to stir after a punishing stretch, and the latest rise in the Altcoin Season Index is reviving hopes that capital may finally be rotating back into the broader market. Altcoin market capitalization, tracked through TOTAL2, has climbed back above $1 trillion and closed the second week of March with its first green weekly candle after seven straight red weeks. At the same time, the Altcoin Season Index has rebounded to 49, its highest reading since January 9, signaling meaningfully improved risk appetite now even if a full altseason has not yet arrived.
Liquidity signals are turning more constructive
The rebound looks meaningful because the market is getting confirmation from falling Tether dominance, a signal many traders read as liquidity leaving the sidelines and moving into risk assets. USDT.D, which measures Tether’s share of total crypto market value, has started flashing bearish signals. Analyst Gordon pointed to a bearish MACD-H crossover as evidence that money could flow back into Bitcoin and altcoins. The index still sits below the 75-point threshold needed to officially confirm altseason, but the speed of the bounce suggests investors are again becoming more willing to deploy capital beyond stablecoin positions.
The optimism, however, is not spreading evenly, because capital is concentrating around only a handful of narratives instead of lifting the entire altcoin complex at once. Analyst Michaël van de Poppe said altcoins could climb 20% to 40% in the near term, yet picking winners has become harder in a market that now contains more than 37 million tokens. For now, artificial intelligence-linked tokens are leading. CoinGecko data cited in the article shows AI coins delivered an average gain of 19% during the first two weeks of March, outperforming other sectors and drawing investor attention.
That selective strength sits inside a fragile macro backdrop, and any altcoin revival may remain narrow unless sentiment improves beyond a market still stuck in extreme fear. Exchange-related tokens are also showing momentum, with Hyperliquid benefiting from its HIP-3 catalyst and OKB rising on news tied to an ICE investment. Even so, the Fear and Greed Index remains in the extreme fear zone, while military tensions in the Middle East show no sign of easing. The result is a market where altseason hopes are back, but conviction is too cautious to call the rally broad-based.
