Ju further predicts that the era of universal altcoin rallies has concluded, emphasizing the need for altcoins to prove their worth in the evolving market landscape.

Solana has faced substantial liquidations, contributing to the overall market correction while also presenting a potential strategic entry point for some investors.

Despite some altcoins experiencing price rallies, RedStone's Marcin Kazmierczak notes that the lack of increasing active users suggests that a true altcoin season has not yet begun.

Capitulation is characterized by panic selling among investors, which could signal a market bottom and potentially set the stage for a new uptrend.

As of late February 2025, 24% of the 200 largest cryptocurrencies have hit their lowest levels in over a year, raising concerns about a possible market purge.

Ju emphasizes that only cryptocurrencies with strong fundamentals, revenue-generating models, or potential ETF approvals are likely to outperform the market.

Currently, seven cryptocurrencies, including Cardano, Solana, and XRP, are awaiting ETF approvals from U.S. regulators, which could significantly boost institutional interest if granted.

Juan Pellicer from IntoTheBlock indicates that the recent downturn in the crypto market, highlighted by significant liquidations and a drop in total market capitalization to $3.13 trillion, may suggest a capitulation phase.

Ki Young Ju, CEO of CryptoQuant, warns that most altcoins may face extinction in 2025 unless they demonstrate economic viability and attract institutional investors.

The current market phase reflects a harsh natural selection process, where only solid projects are likely to thrive in the upcoming bullish cycle, contrasting sharply with previous generalized market surges.

This correction phase is marked by the liquidation of over-leveraged positions, as noted by senior analyst Juan Pellicer.

User activity and economic fundamentals are crucial for the survival of altcoins, as many are experiencing user volumes significantly below their 2021 peaks, indicating ongoing speculation rather than widespread adoption.