Here’s How To Trade Altcoins in 2025, Analyst Explains

Crypto analysts warn that today’s altcoin market demands a sharper, more disciplined approach than previous market cycles.

The warning comes amid a broader market lull, with Ethereum (ETH), the largest altcoin by market cap metric, dropping to below $4,200.

Why Altcoin Success Now Demands Discipline, Conviction, and Liquidity

BeInCrypto reported how digital asset treasuries (DATs) are emerging as crypto’s Berkshire Hathaway, with holdings worth $105 billion.

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It points to the concentration of capital in a handful of outperforming narratives. Against this backdrop, traders risk being left behind if they rely on outdated strategies.

Crypto analyst Miles Deutscher stressed that 2025’s environment is not comparable to the broad rallies of 2021 or even 2024.

“The best way to approach today’s market is entirely different from 2021, or even 2024,” he wrote on X (Twitter).

According to Deutscher, the market has effectively split into two camps. On one side are pockets of outperformance, such as decentralized exchanges (DEXs) like ASTER, centralized exchange tokens like BNB and Mantle (MNT), and select plays like Story (IP) and STBL.

On the other hand, the majority of altcoins remain flat or in decline as liquidity clusters around dominant narratives.

Deutscher argued that the only way to succeed in this fractured playing field is to adopt a more disciplined approach. He advised traders to shrink their portfolios, concentrate on assets they believe in, and keep ample stablecoins available to pounce on new opportunities.

• Hold fewer tokens – avoid bloated portfolios that dilute conviction.

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• Concentrate on high-conviction plays – ensure picks align with broader market trends.

• Keep stables ready – maintain liquidity for surprise opportunities.

• Cut underperformers quickly – don’t let weak assets drain opportunity cost.

He cautioned that the temptation to chase every rally can be dangerous in a market where most projects remain sidelined.

“It’s better to wait for the stars to align on a trade than to constantly force long exposure due to ‘alt season’ FOMO,” he said, highlighting the risk of clinging to outdated strategies.

Regarding the willingness to exit underperforming positions swiftly, the analyst noted that opportunity costs are higher than ever, with liquidity scarce and cycles rotating quickly.

In this regard, cutting laggards early allows traders to reallocate into stronger plays without hesitation.

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“The game is still insanely profitable for those who play it correctly – but you can’t rely on old tricks to succeed on a new playing field,” he stated.

Discipline Over FOMO: Navigating Liquidity Squeeze and Positioning Risks

The crypto analyst also cautioned against clinging to a generalized altcoin season, warning that chasing exposure for its own sake could prove costly.

“It’s better to wait for the stars to align on a trade than to constantly force long due to ‘alt season’ FOMO,” Deutscher added.

Elsewhere, a DeFi researcher echoed the sentiment, pointing to the structural liquidity squeeze across crypto.

The researcher, who goes by the pseudonym Stitch on X (Twitter), said altcoin bets should focus on fundamental projects that bring tangible value and generate yield rather than speculative plays hoping to ride momentum.

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Meanwhile, Deutscher emphasizes the importance of position sizing as the overlooked factor separating winners from underperformers.

“Making a 10x on a token is useless if you only allocated $50 of a $50,000 portfolio. But allocating $10,000 to a 2x play has now increased your portfolio by 20%. Knowing when to size up, and having the conviction to do so, is what separates mediocre traders from great ones,” he noted in a separate post.

These insights suggest that success in today’s fragmented market will come from discipline, focus, and conviction, rather than chasing every token on the board.

They also align with a recent BeInCrypto report, highlighting why altcoin season peaks but investors still struggle to profit.

“Position sizing is everything. Many people hold 25–30 tokens at once. A 100x on a token that makes up only 1% of your portfolio won’t meaningfully change your life. It’s better to make a few high-conviction bets than to overdiversify,” analyst The DeFi Investor said.

Notwithstanding, investors and traders must always conduct their own research and not rely entirely on insights from KOLs and other industry pundits.