Original author: TechFlow, TechFlow
Are you going back to eat at the encrypted restaurant?
The crypto market has rebounded in the last two weeks. In addition to the emergence of Uniswap Hook V4 narratives on some blockchains, a number of older cryptocurrencies have seen a resurgence.
Among them, the L1 sector performed well, with ZEC, TON, and SUI showing particularly strong gains. We already introduced ZEC last week, while SUI and TON showed independent performance against the backdrop of a flat market: TON rose from $1.35 to $2.89 in three days, and SUI rose more than 24% in a single week, breaking through $1.24.
Each blockchain has its own verifiable catalysts, both in terms of news and fundamentals. Meanwhile, the L1 blockchain's initial unusual activity raises the question: does this foreshadow a broader rotation Altcoin?
BTC dominance hits a new high for the year, but the L1 track is the first to show signs of change.
Let's look at the macro background first.
According to Bitget data, as of May 9th, BTC dominance rose to 60.3%, the highest level since 2026. Blockchaincenter's Altcoin Season Index reading is around 35, well below the 75 threshold required to confirm an altcoin season, indicating the market is still in a "Bitcoin season."
However, structural signals have emerged. The BTC dominance rate has been consolidating in the 58%-60% range for nearly eight months (August 2025 to April 2026), and the RSI shows signs of stagnation.
Analyst el_crypto_prof on X points out that the weekly chart structure of the total market capitalization of Altcoin(excluding BTC) is highly similar to the patterns preceding the altcoin booms of 2016-2017 and 2020-2021. In both historical periods, the combination of high dominance and low altcoin boom index ultimately appeared 2 to 6 months before the start of the most profitable Altcoin rallies.
During this window of opportunity where "the macroeconomic situation is still uncertain but individual stocks are taking the lead," SUI and TON each developed their own independent market trends.
TON: Telegram has transformed from a "partner" to a "de facto controller".
TON's surge had a precise trigger point: on May 4th, Telegram founder Pavel Durov announced on X that Telegram would replace the TON Foundation as the largest validator and main driving force of the TON network.
This event needs to be viewed within the context of history.
In 2020, Telegram was forced to withdraw from the TON project due to SEC enforcement action, returning $1.22 billion in investor funds and paying an $18.5 million fine. Durov announced the project's termination in a blog post. The TON Foundation then operated as an independent community for five years.
Six years later, Durov returned in person, pledged approximately 2.2 million TON, and switched the ton.org domain to the MTOGA (Make TON Great Again) theme page.
According to The Defiant, TON surged 33% that day, reaching a high of $1.90 during the session. By May 7th, the price had soared from $1.35 at the beginning of the month to around $2.89, a three-day increase of approximately 114%, with a 24-hour trading volume of $3.31 billion, a record high for TON. According to CoinGlass data, futures open interest also rose to $628 million, a three-year record.
Before Telegram took over, Durov completed an intensive round of technical upgrades in one month:
- On April 9th, Catchain 2.0 consensus upgrade went live, reducing block time from 2.5 seconds to 400 milliseconds and increasing throughput by approximately 10 times. In Durov's own words on X, TON is now "the fastest finality chain among all mainstream L1 chains."
- By the end of April, transaction fees had been reduced from approximately $0.0023 to approximately $0.0005, a six-fold decrease, with the rate remaining fixed and unaffected by congestion. Durov stated that "most transactions will be completely free going forward."
Institutional investors are also following suit. Rakuten Wallet in Japan launched TON spot trading in mid-April, and CoinShares launched a TON staking ETP on the Swiss exchange SIX. Reports indicate that the USDT supply on the TON network has exceeded $500 million, and the monthly trading volume of perpetual contracts in Telegram's built-in wallet has surpassed $1 billion.
TON's technological updates and upgrades are ongoing. Durov's goal is to develop Telegram into a super application portal integrating payments, DeFi, AI agents, and private communication, with TON serving as the underlying financial layer.
However, I believe that Telegram becoming the largest validator essentially increases the network's dependence on a single entity. If Telegram faces regulatory scrutiny again (the aftermath of the SEC case is still fresh), or if validator nodes malfunction, the impact on the network and cryptocurrency price will be far greater than under a decentralized architecture.
SUI: Acquired the institutional "three-piece set" within a month.
The catalyst for SUI came from another direction: the intensive rollout of institutional infrastructure within a month.
If we were to compile a list of crypto assets that simultaneously have significant stakes in US spot ETFs, CME futures contracts, and publicly traded companies, previously only BTC and ETH were included. Starting in May, SUI joined the list:
- The spot ETF cluster (late February): 21Shares TSUI (Nasdaq, expense ratio 0.30%), Canary Stake SUI ETF, and Grayscale SUI Staking ETF were listed within a week. Bitwise, Franklin Templeton, and VanEck also made related investments.
- CME futures launched (May 4): Standard contract 50,000 SUI, Micro contract 5,000 SUI, cash settlement. On May 6, FalconX and G-20 Group completed their first block trade. From May 29, all CME crypto derivatives became available 24/7.
- Large-scale pledging by listed companies (May 9): Nasdaq-listed SUI Group Holdings converted all 108.7 million SUI tokens (2.7% of the circulating supply) into native pledges, causing the price to jump 13% on the same day.
- Emerging Market Payments Deployment (May 9): At Sui Live Miami, Nigerian fintech company Paga announced a deep integration with Sui, planning to leverage its native stablecoin USDsui to provide users with USD accounts and tokenized bonds. Paga processed $11 billion in transactions by 2025.
According to CryptoNews analysis, SUI currently possesses a complete "three-tier institutional access architecture": spot ETFs provide passive allocation, CME futures provide active hedging, and staking products provide returns. 18 months ago, only BTC and ETH had this structure.
As of May 10, SUI was trading at $1.24, up over 24% for the week, with trading volume exceeding $1.2 billion. On the day CME futures were launched, SUI actually dipped slightly to $0.91, only truly rallied five days later when staking and the Paga collaboration were finalized. Meanwhile, other tokens in the SUI ecosystem also benefited, experiencing significant price increases.
Will the L1 rebound spread to counterfeit goods?
Looking at SUI and TON together, their catalyst structures are quite different, but they have in common that both are driven by project-specific, verifiable fundamental events, rather than macro liquidity or sentiment beta.
Returning to the macro level, none of the confirmation conditions for a broad altcoin season are currently met. According to historical patterns compiled by Phemex, a reliable rotation signal requires the BTC dominance rate to fall below 54% for more than two weeks, and the altcoin season index to break through 75. The current dominance rate of 60% and index reading of 35 are still significantly below these thresholds.
Historical data provides a reference point:
In late 2019 and late 2020, the combination of a high BTC dominance and a low altcoin index ultimately led to a large-scale Altcoin boom 2 to 6 months later.
At that time, the first projects to launch were those with independent catalysts, and then funds gradually spread to small and mid-cap stocks. The unusual movements of SUI and TON may be in this stage of "individual projects taking the lead, and overall rotation awaiting confirmation".
The spring river is warming, and the ducks are already moving. But the ice on the river has not yet completely melted.
