Altcoins Cool Off While Stablecoins Surge – What’s Next for Crypto?
By Abhishek Chauhan
This week, the Altcoin Season Index stands at 19, up from 13 last week. While Bitcoin dominance remains strong, a rise above 50 in the index would indicate the start of a true altseason. Some analysts argue that altseason may have already passed, with liquidity shifting toward memecoins and institutional-grade investment products. The stablecoin market cap has surged past $200 billion, up from $115 billion a year ago, reflecting growing demand for digital dollar alternatives. Meanwhile, the altcoin market cap has declined to $1.2 trillion from $1.4 trillion over the past year but also peaked at $1.9 trillion in December 2024, highlighting shifting market dynamics and increased Bitcoin dominance. Stablecoins remain a crucial pillar of crypto liquidity, facilitating transactions across decentralized finance (DeFi) and centralized exchanges. However, increasing regulatory scrutiny and new entrants in the stablecoin sector are reshaping the landscape. The emergence of state-backed stablecoins, financial institution-led initiatives, and political figures entering the market further complicates the industry’s future. Let’s explore the biggest catalysts shaping the Altcoin & Stablecoin sectors this week.
ALTCOINS: KEY DEVELOPMENTS & MARKET MOVERS
- Ethereum’s Pectra Upgrade: Ethereum’s Pectra Upgrade will be activated on the Hoodi testnet this week. This upgrade, a fusion of the Prague and Electra updates, introduces features like ERC-20 gas fee payments, transaction batching, sponsored transactions, and a higher staking limit. If successful, mainnet activation could follow by late April.
- AAVE’s Buybacks & Governance Expansion: Following the approval of the Aavenomics proposal, AAVE could implement a Buy & Distribute mechanism, allocating $1M per week for six months to buy back AAVE tokens. If the final governance vote passes, buybacks could begin by the end of this month, reinforcing ecosystem stability and boosting long-term value.
- Berachain’s Proof of Liquidity (PoL) Launch: Berachain’s PoL mechanism will go live, allowing ecosystem dApps to compete for token emissions by bribing Berachain validators. This marks a unique approach to liquidity incentivization and could impact the broader DeFi landscape.
- New Token Launches on a platform known as Fjord Foundry: Stable Jack – Token sale started on March 26, 75% filled, Athena Labs is their accelerator. Stable Jack is a yield, volatility, and points market for any asset. Investors can access fixed, and leveraged yield on any asset.
- Beraborrow – Token sale begins March 28, Beraborrow unlocks instant liquidity against Berachain assets through the first PoL-powered stablecoin NECT, which can be utilized throughout the Berachain DeFi ecosystem. ATH TVL $400M+ making it the 3rd largest CDP protocol in the world.
- Hyperstable – Launching in a few hours, Hyperstable is a crypto-backed, over-collateralized, and decentralized stablecoin launching on HyperEVM.
STABLECOINS: SECTOR DEVELOPMENTS & REGULATORY OUTLOOK
- Fidelity Prepares for Stablecoin Launch: Fidelity Investments is finalizing its stablecoin, advancing institutional adoption of digital assets. Currently in testing, it will function as a digital cash equivalent, aligning with growing regulatory clarity on crypto financial products.
- Wyoming’s State-Backed Stablecoin Set for July: Wyoming’s state-backed stablecoin, developed with LayerZero, is in final testing across multiple blockchains. The initiative aims to enhance financial transparency, backed by the Wyoming Stable Token Act (2023).
- Custodia Bank Issues Stablecoin on Ethereum: Custodia Bank, in partnership with Vantage Bank, has launched Avit, the first bank-issued stablecoin on a permissionless blockchain. Tokenizing dollar-demand deposits on Ethereum, the initiative highlights low transaction costs, fast settlements, and improved auditability. CEO Caitlin Long emphasized its compliance and regulatory milestone, potentially shaping future stablecoin policies.
- Request Finance Surpasses $1B in Transactions: Request Finance has processed over $1 billion in stablecoin payments, serving major clients like The Sandbox and Arbitrum. To expand its crypto payment solutions, it secured funding from Bpifrance and acquired Consola Finance and Pay.so. With MiCA regulations approaching, the platform is strengthening compliance.
- Trump’s Crypto Venture Launches Stablecoin USD1: Donald Trump’s crypto firm, World Liberty Financial, is set to launch USD1, a stablecoin backed by U.S. Treasuries and dollar deposits. This aligns with Trump’s push to position the U.S. as a global crypto hub, while also raising concerns over potential regulatory conflicts.
- Circle and SBI Expand USDC in Japan: Circle has secured Japan’s first stablecoin approval, partnering with SBI Holdings to bring USDC to Japanese markets. SBI VC Trade will list USDC on March 26, with other exchanges expected to follow, marking a major step for Japan’s stablecoin framework.
Final Take: Altcoins are evolving beyond a unified category, with sector-specific narratives driving value. Stablecoins are playing an increasingly significant role, not only in DeFi liquidity but also in institutional finance and regulatory discussions. With major players like Fidelity, Wyoming, and Trump-backed ventures entering the market, stablecoin competition is intensifying. Keep an eye on Ethereum’s Pectra upgrade, AAVE’s buybacks, new token launches, and stablecoin sector developments as the next catalysts in the crypto space.
You need to login in order to Like
