The long-awaited alt season, a bull-market phase characterized by alternative cryptocurrencies (altcoins) outshining bitcoin (BTC), could occur soon, with President Donald Trump considering giving U.S. citizens “tariff dividends” in a move that may spark riskier financial behavior among recipients.
“They’re just starting to kick in,” Trump said about the tariffs in an interview with One America News Network cited by the New York Post, “but ultimately, your tariffs are going to be over a trillion dollars a year.”
Trump said his primary goal is to use the revenue to reduce the federal debt. He also said he may distribute some of the funds to Americans as rebates of as much as $2,000, in what he described as “dividend to the people of America”.
The potential dividend, coupled with expected Federal Reserve interest-rate cuts, may alleviate household budgetary constraints, spurring a greater tendency to financial risk-taking and possibly boosting investments in altcoins, which have lagged behind the largest cryptocurrencies this year.
The CoinDesk 20 Index of largest cryptocurrencies has climbed 48% in 2025, almost seven times as much as the CoinDesk 80 Index of next-largest tokens.
The tendency to increase risk-taking was described in a 2023 research paper by Marco Di Maggio at Harvard Kennedy School. It found that more relaxed household budget constraints through stimulus payments increased crypto investing. The paper added that tighter future budget constraints due to higher expected inflation also boosted crypto investing, consistent with hedging motives.
There is a precedent, too.
Altcoins experienced a dramatic surge in 2020-21 as the government issued stimulus checks to support households during the coronavirus pandemic. Those unexpected freebies were largely channeled into the crypto market, which caused frenzied trading in the altcoin market. Bitcoin’s dominance rate, or its share in the total crypto market cap, collapsed to 39% from 73% in six months to May 2021.
“In 2020, crypto’s institutional rails were barely in place: No spot ETFs, fragmented custody, regulatory ambiguity,” Jasper De Maere, an OTC desk strategist at leading market maker Wintermute, wrote in a LinkedIn post. “Retail-led rallies fueled by stimulus checks and [ultra high-net worth individual] cash, 80-90% retail flows allowed rapid cascades from majors to altcoins.”
It remains to be seen if the potential tariff dividend to the American people has a similar impact of broadening the crypto market bull run.
The crypto market’s gain this year — total market cap is about $4 trillion versus $3.4 billion at the end of 2024 — is largely led by bitcoin and other major tokens, such as ETH, SOL, BNB and XRP.
One rose altcoins have failed to keep pace is that U.S. interest rates are now elevated above 4%, as opposed to 2020, when they were pinned at zero, which galvanized a search for yield in all corners of the financial market.
Another reason is the vastly larger total crypto market cap itself, which has capped indiscriminate rallies in the broader market.
“Higher rates and vastly larger market cap make indiscriminate altcoin rallies far less likely,” De Maere said. Any coming altseason will be more selective and disciplined, driven by genuine utility rather than speculative hype, requiring rigorous analysis to separate real-world traction from vaporware.”
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