The cryptocurrency market is at a remarkable stage. Since the rebound from the local bottom in April 2025, the altcoin market has been hovering at high levels. Currently, the market capitalization is approximately $300 billion, which is a significant increase compared to the $175 billion in April 2025. Even more strikingly, the altcoin market was only $68 billion when it hit the bottom in 2023.

This significant change in market capitalization means that a large amount of capital has not only been diluted but also concentrated in a few projects. Recently, we have observed the outstanding performance of projects like HYPE, LINK, SUI, and XLM. At the same time, mainstream cryptocurrencies such as XRP, ETH, BNB, and SOL have also attracted a substantial influx of funds.

Currently, the market presents an interesting phenomenon: although there is a considerable amount of capital flowing overall, the frequency of fund rotation is not as high as in 2017 and 2021, especially for large capital movements. In contrast, the low market capitalization altcoin market shows a completely different picture, characterized by frequent fund rotations, quickly shifting from one project to another.

However, this rapid rotation among low market capitalization projects is mainly driven by small capital, which is smaller in scale compared to large capital. Currently, only a few thousand small wallets are participating in this high-risk 'casino-style' trading, which limits the ability to maintain a long-term upward trend. Funds may flow into a high-quality project within a few days, but quickly shift to a popular meme coin.

The key question is: will we remain trapped in the current market structure? Or in the later stages of this cycle, will we see a better rotation between large capital and small capital, leading to a broader market rally? The answer to this question will greatly influence the future development of the cryptocurrency market.