The crypto community was shaking after Crypto Rover tweeted that quantitative tightening (QT) would cease in December and that altseason would now be back. He displayed a graph that depicted the new dominance shift and Total3 market cap (alcomponents alone) and requested those who had them to start believing.
According to Crypto Rover, central bank QT, announced by the Federal Reserve in the U.S, will come to an end in the 2025 month of December. He thought that after QT, the liquidity situation will become better, and risk assets, such as altcoins, will gain. As the chart that he provided (obtained at BlockchainCenter.net) shows, the indicator of altcoin season recently reached the mark of approximately 75 per cent dominance and then fell to approximately 43 per cent. The chart establishes limits: the alt-season starts when it is above 75, and Bitcoin season when the dominance is less than 43.
Quantitative tightening can be defined as the act of central banks shrinking their balance sheets selling or failing to reinvest bonds therefore limiting liquidity. QT started in 2022 and has had the impact across all risk assets. Cryptocurrency markets traditionally work better during easing or high-liquidity regimes. As an illustration, altcoins have skyrocketed after the repeal of major QT or introduction of quantitative easing. Cryptocurrency analysts associate the previous altseasons (e.g. 2021) with huge liquidity inflows. The chart reveals that the market went through a transition stage after increasing the altcoin dominance by around 2030 to 80 per cent in the period between 2024 and 25.
In case QT ceases to exist at the end of the month in 2025, a surplus of capital would enter the altcoins. Based on previous regime studies, a crypto market cap without Bitcoin and Ethereum (Total3) has the potential to reach the 1.6 trillion level. Marketers and builders would stop paying attention to the Bitcoin to smaller-cap tokens, decentralized finance (DeFi), and layer-1 networks. His chart indicates that there is an opportunity window before a big rotation.
There is no official announcement that QT will certainly stop in December 2. The altcoin dominance indicator (provided by BlockchainCenter) is still only a heuristic, rather than a promise. Although the historical tendencies go with his theory, the history does not influence the future.
