Microcap tokens NKN, GIZA, and XTER surged from 54% to 144% on March 27, showing a trend of individual investors rotating into low liquidity altcoins.
The trading volume of NKN alone is only $13.9 million, making it the 812th token by market cap, yet it surged 637% to record $24.1 million.
This surge occurred in a market environment dominated by Bitcoin (BTC), and the CMC altcoin season index remains at 34 out of 100, significantly below the benchmark of 75 that defines an altcoin season.
Bitcoin dominance remains around 58%, and only 21% of the top altcoins have outperformed Bitcoin over the past 3 months, according to Capriole Investments.
The surge in trading volume led to an NKN rally
NKN surged by 144.71% over 24 hours, reaching $0.017356, expanding its increase to 229.50% on a 7-day basis.
The trading volume of NKN, a decentralized networking token, surged by 1,711% compared to usual, reaching a total of $24.1 million on exchanges including Coinbase and KuCoin.
The token's RSI recorded 68.34, coming close to the overbought zone.
CoinMarketCap analysts attribute this rise to a "sector rotation into low-market-cap altcoins rather than fundamental changes," noting that similar micro-cap tokens recorded triple-digit returns during the same period.
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The altcoin season is still absent
Despite individual surges in some tokens, the overall structure of the market still indicates bearishness. According to the Crypto Market Breadth indicator, only 8% of all altcoins are trading above the 50-day moving average.
The total market capitalization of all altcoins excluding Bitcoin decreased by 32% from a peak of $1.77 trillion on October 2025, falling to $1.19 trillion in December.
According to CryptoRank, the number of tracked tokens increased from 5.8 million to 29.2 million over the past year, leading to increased capital dilution and a fragmented market.
Such expansion acted as a factor limiting the necessary 'focused buying power' for a sustained rally across the sector. Bitcoin dominance soared to 65% in June 2025, yet remained above 56% throughout March.
Meme coins and perpetual futures contracts are absorbing the speculative capital that used to drive past altcoin rallies, creating a competition for individual investor interest as betting has become possible without directly holding tokens.
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