Altseason is coming — and traders are more discerning this time

Altseason is almost here and early signs suggest traders are becoming more selective, with capital flowing into revenue-generating protocols across a number of different narratives.

Altseason may not be officially here, but traders are starting their rotations — and the numbers are getting harder to ignore.

Over the past 30 days, memecoin launchpad PONS soared more than 350% in price, while in DeFi, Uniswap’s UNI gained more than 110%, Arbitrum’s ARB jumped over 150% and AI-focused NEAR also shot up around 180%.

Privacy token Zcash hit a record high above $1,600 last week, while Bitcoin Layer-2 token LIT and memecoin launchpad token PUMP are also among the biggest gainers over the period, according to CoinMarketCap.

Spanning very different sectors, those gains don’t point to one obvious trade, but they do suggest many traders are looking at coins with a good business case behind them this time around.

Looking at the massive gains in tokens such as ARB, UNI, Jupiter’s JUP and Ondo’s ONDO, Bankless podcast host David Hoffman said Friday that what they had in common is, “They make money, they all print revenue,” suggesting that this rally could be driven by utility rather than speculation.

Among the top 20 biggest gainers last week, there were only two memecoins. In the past week, only Pudgy Penguins made the list.

But it’s not all about fundamentals according to 1inch co-founder Sergej Kunz, who notes that over the last 30 days, memecoins have shown the strongest growth among buyers. But he says DeFi protocols, privacy tokens, AI projects and tokenized assets are also attracting attention.

Related: The 100x obsession: Fundamentals grow in importance as crypto matures

“The pattern so far is breadth before depth,” he tells Magazine, with more wallets buying a broader range of tokens, but generally in smaller amounts.

“The caution in the data fits the broader pattern of selective participation,” he says. Users are participating “selectively rather than going all-in.”

Is the market finally getting more discerning and allocating into assets with actual utility as Hoffman suggests, or will it once again end up driven by memecoins featuring dogs in hats and sexual innuendos?