I doubt it will be everything rally like the mindless 2020-21 alt season.
A select few alts could go berserk lifting total alt valuation but that too seems difficult given we are in an era of fiscal dominance. Here is why
2020-21 cycle
Rates were near zero, QE was massive, alongside cash handouts, injected broad-based liquidity
That caused a classic Cantillon effect — early receivers of new money (financial markets, asset holders) saw prices surge across the board: equities, crypto, housing, commodities, everything.
Hence, the “everything rally” — including altcoins, because liquidity was cheap and abundant
Now: Fiscal Dominance ≠ Monetary Liquidity
Today’s environment is very different:
Central banks are not doing QE, and rates are still high.
Governments are running fiscally expansionary budgets, but that spending is:
Targeted liquidity creation aimed at reindustrialization, infrastructure etc to outgrow debt and bringing down debt-to-gdp)
It’s Funded via debt issuance absorbed by private markets, not by the central bank balance sheet.
This is “fiscal dominance” — where fiscal policy sets the tone and the central bank follows to accommodate, but it doesn’t create base money in the same broad sense.
So, while fiscal spending boosts nominal GDP and real investment, it doesn’t necessarily spill over into speculative assets like alts — unless those assets are directly linked to fiscal beneficiaries
To conclude,
QE cycles mainly affect financial asset valuations.
Fiscal-driven capex cycles affect real economy investment (factories, infrastructure, supply chains).
So instead of “everything up,” we get dispersion — select sectors, commodities, and supposed store of value assets like gold and Bitcoin do well. Stablecoins too as escape valve amid capital controls
Alts, which rely on classic cen bank induced excess liquidity, may lag or fail to participate fully. This is exactly why alts haven’t had a great run this time…
In short:
So, unless central banks pivot back to 2020-21 aggressive monetary easing, an “alt season” like 2021 looks unlikely. Moreover, with fiscal dominance 2020-21 like easing looks in likely
Only time will tell
But Waiting for watch and learn kind of reply to this 🤣