Crypto market maker Wintermute has released its 2025 annual report, challenging several long-held assumptions about crypto market behavior and signaling a structural shift in how capital is being allocated across digital assets.
Key Findings on Capital Flows
Contrary to expectations of a broad “altcoin season,” Wintermute’s data shows that a massive rotation from Bitcoin and Ether into smaller, long-tail altcoins never materialized.
Instead, capital that moved away from Bitcoin and Ethereum largely flowed into other large-cap tokens.
According to Wintermute’s OTC trading data, the combined share of BTC and ETH declined modestly from 54% in 2023 to 49% in 2025, while top-10 tokens excluding BTC and ETH grew steadily. Smaller altcoins, however, saw their share shrink over the same period.
Accelerated Altcoin Narrative Cycles
The report also highlights a sharp acceleration in how quickly altcoin narratives now play out. The median duration of altcoin rallies fell to just 19.5 days in 2025, down from more than 60 days in 2024.
Wintermute said this reflects faster information flow, more crowded positioning, and traders rotating capital more rapidly rather than committing to prolonged thematic trades.
Growth in OTC Options Activity
Another notable trend is the growth of OTC options activity. Wintermute recorded a sharp increase in both notional value and trade counts throughout 2025, with activity peaking in the second half of the year.
Options usage has also diversified, moving away from simple directional bets toward more systematic strategies involving combinations of calls and puts.
Retail Investor Behavior and Competition
On the retail side, Wintermute observed that many investors rotated defensively back into major cryptocurrencies after October’s market turbulence, rather than doubling down on speculative altcoins.
At the same time, the firm noted growing competition from traditional equity markets, with retail investors increasingly favoring stocks over cryptocurrencies.
Challenging the Traditional Crypto Cycle
Perhaps most strikingly, Wintermute argues the traditional four-year crypto cycle is breaking down. Market direction, the firm says, is now driven more by liquidity concentration, product access, and institutional structures than by predictable halving-based cycles.
Outlook for 2026
Looking ahead to 2026, Wintermute said the expansion of crypto exchange-traded products and digital asset trusts will be a key factor in determining whether capital broadens beyond a narrow set of dominant assets or remains tightly concentrated at the top of the market.