Matrixport Research: Why Is the Altcoin Bull Market Absent? Supply Pressure and Token Unlocks Become Key Variables

MatrixportPublished on 2026-03-06Last updated on 2026-03-06

Abstract

Matrixport Research: Why the Altcoin Bull Market is Absent? Supply Pressure and Token Unlocks Emerge as Key Variables The anticipated altcoin rally has not materialized over the past year. Historically, Bitcoin's rise leads to capital overflow into altcoins, but this transmission mechanism has significantly weakened in the current cycle. Retail participation remains low, and many projects lack compelling narratives or real-world utility to drive market momentum. Persistent supply pressure is a primary constraint. Early investors continue to divest, and new token unlocks are constantly adding to the circulating supply. Since August 2024, approximately $99 billion worth of tokens have been unlocked, creating sustained selling pressure. This explains why altcoins have underperformed Bitcoin and failed to reach previous cycle highs. Despite the overall bearish sentiment, historical patterns suggest that large-scale unlocks can sometimes improve short-term liquidity and spark temporary rebounds. An upcoming $4.7 billion unlock, the third largest since August 2024, is expected next week. However, the current rebound appears to have started only about a week in advance, indicating its influence may be weaker than previous cycles. A key market indicator is the altcoin total market cap's deviation from its 90-day moving average. The market is potentially approaching an oversold zone, which could set the stage for a tactical rebound. In summary, the altcoin market faces a structur...

"Sustained supply pressure continues to be released, and the altcoin market is shifting from a structural bull market to cyclical trading opportunities."

Over the past year, the anticipated altcoin rally has failed to materialize as expected. In previous cycles, Bitcoin's rise typically drove capital overflow, gradually transmitting to altcoin sectors. However, in this cycle, this transmission mechanism has significantly weakened. Retail participation remains consistently low, with many projects lacking compelling new narratives to drive the market or providing solutions with real-world application value. At the same time, continuous selling by early investors and the new supply brought by token unlocks are constantly putting pressure on the market. Against this backdrop, altcoins have continued to underperform, and investor sentiment is generally dampened. However, the market still features some periodically strong performers, and such opportunities can often be identified through certain market structure signals.

Sustained Supply Pressure: Altcoin Rally Momentum is Limited

Since October 2025, although Bitcoin has experienced periodic pullbacks, the market dominance has not significantly declined and has recently rebounded to new highs. This round of market action seems more like it is led by Bitcoin, driving altcoins to follow with periodic gains. At the same time, more and more companies adopting treasury allocation strategies continue to accumulate Bitcoin, keeping its structural demand stable.

In comparison, altcoins face more obvious supply pressure. Early investors continue to release their holdings, coupled with the new circulating supply brought by token unlocks, frequently limiting the market's upside during rebounds. Since August 2024, approximately $99 billion worth of tokens have been unlocked and entered circulation, bringing sustained supply shock to the market.

As retail participation enthusiasm cools, the supply side's impact has gradually become the key variable dominating price trends. This also explains why in this bull market from 2024 to 2025, altcoins have not only underperformed Bitcoin, but their overall market capitalization has even failed to reach the highs of this cycle.

Unlock Windows and Market Structure: Periodic Rebounds Are Still Possible

Historical experience shows that large-scale token unlocks often improve market liquidity in the short term and drive a rebound in trading activity. In many cases, altcoins experience periodic rebounds around unlock windows. This is due to both the improved承接 capacity brought by increased trading volume and the reallocation of capital within the sector.

Next week is expected to see about $4.7 billion in token unlocks, making it the third largest unlock week since August 2024. Historical data shows that in unlock windows of similar scale, the crypto market often rebounds in the weeks before the unlock, while the overall market capitalization tends to peak shortly after the unlock.

However, this rebound seems to have started only about a week in advance, indicating its influence may be weaker than previous instances. This round of unlocks is mainly concentrated in a few protocols, the vast majority of which come from the platform token WhiteBIT Coin from the European crypto exchange WhiteBIT. Although the token's fully diluted valuation (FDV) is about $16.6 billion, its average daily trading volume is only about $74 million, meaning a relatively limited trading scale, which could also lead to disproportionate price volatility.

Based on comprehensive historical experience, a more practical market indicator is the degree of deviation of the total altcoin market capitalization relative to its 90-day moving average. When the total market cap is more than 50% above the 90-day average, the market usually enters a period of阶段性过热区间; when it is about 30% below the 90-day average, tactical rebounds are more likely to occur. The current market structure suggests that the selling pressure on altcoins may be gradually approaching an over-released zone.

Overall, the altcoin market is at a critical juncture. Structurally, this sector still faces a dual pressure: on one hand, overall retail demand is weak; on the other hand, token unlocks and early investor selling continue to pressure the supply side. This structural characteristic has significantly weakened the traditional transmission path of "Bitcoin's rise driving altcoin gains" in this cycle.

The above views are from Matrix on Target, contact us to get the full Matrix on Target report.

Disclaimer: The market is risky, investment should be cautious. This article does not constitute investment advice. Digital asset trading may carry significant risks and instability. Investment decisions should be made after carefully considering personal circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided herein.

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