Should Investors Buy Low-Cap Altcoins in Q3/2025?

Many analysts share the same view as investor Mister Crypto. According to them, the market is still in phase two. In this stage, investors mostly favor Ethereum. Capital will eventually rotate to large, mid, and low caps.

This delay creates a window of opportunity for many investors to buy early and at a good price. It’s also a chance to get ahead of the broader capital flow.

Still, analysts like João Wedson remain skeptical of ultra-low-cap altcoins—especially those outside the top 300. These coins usually have a market cap of less than $200 million. He cites the Open Interest to Market Cap Ratio as a warning signal for these coins.

Data shows that open interest for coins outside the top 300 is unusually high compared to their market caps.

When open interest significantly surpasses market capitalization, it indicates that traders are focusing on short-term movements in the derivatives market instead of actively trading the tokens in spot markets. Consequently, these altcoins experience low liquidity and encounter extreme volatility.

“From the Top 300 down, Open Interest becomes disproportionately high compared to Market Cap — a strong risk signal. What does this mean? These altcoins will eventually liquidate 90% of traders, whether they’re long or short. They are also much harder to analyze with consistency,” Joao Wedson explained.

On X, excitement about altcoin season is spreading fast in July. However, whether investors should buy low-cap altcoins in Q3/2025 still depends heavily on their personal risk appetite and investment strategy.