OTC Wintermute Data: Liquidity mainly concentrated in BTC, ETH in 2025

Liquidity in the crypto market has ceased to spread widely in 2025, leading to a series of ripple effects across the entire market, according to the latest report from market maker Wintermute.

Wintermute states that the structure of the crypto market has changed significantly over the past year, as liquidity is no longer broadly distributed across altcoins but increasingly concentrated in Bitcoin, Ethereum, and a small group of large-cap tokens. This shift in capital flow has caused the market to break away from familiar “cyclical scenarios” of the past.

“Capital no longer disperses widely across the entire market,” Wintermute notes in the 2025 OTC digital asset report, built on the company’s exclusive OTC trading data.

Capital shift from BTC and ETH to other major cryptocurrencies | Photo: Wintermute. Instead, liquidity has become concentrated and unevenly distributed, with large volumes revolving around only a few assets. Market performance increasingly depends on entry points of capital flow and how that capital is deployed. Wintermute points out that ETF funds and corporate treasury crypto holdings—entities that are expanding rapidly—have played a key role in steering cash into core assets, resulting in spot trading being focused on the top-tier groups.

Shorter altcoin waves, early meme coin cycle collapse

Wintermute also indicates that the meme coin cycle has “collapsed” since the beginning of the year, further narrowing the capacity for capital formation and limiting the durability of rallies outside the major assets.

As a result, the altcoin market has become more selective, with short-term price surges driven by opportunistic themes such as memecoin launchpads, perpetual DEX derivatives, or emerging payment infrastructure and APIs, but lacking sustainable continuity.

According to the report, the median duration of an altcoin “narrative rally” in 2025 is only about 19 days, a sharp decrease from approximately 61 days the previous year.

Institutional traders becoming more tactical, derivatives increasingly sophisticated

The report also notes changes in how major partners execute trades. Institutions show a declining level of trend confidence, instead adopting more tactical approaches, reacting flexibly to news. Orders are executed more deliberately and frequently, reflecting increasing sophistication and a move away from simple seasonal trading cycles like “Uptober.”

In derivatives, Wintermute states that off-exchange trading structures continue to expand. CFDs are used more frequently as an efficient capital access tool for many underlying assets. Meanwhile, options have successfully matured into core portfolio management tools, with systematic strategies and yield generation gradually replacing one-directional trend betting approaches like those seen in previous cycles.

Seasonal crypto trading patterns have decreased in 2025 compared to previous years | Photo: Wintermute.## Significant liquidity flows are just as important as market sentiment

The central message of the report is: the path of liquidity now matters just as much as the overall market risk appetite.

Wintermute believes that capital increasingly flows through structured channels like ETFs and crypto treasury companies, which determine where liquidity depth is accumulated and where large-scale trading can still occur. This strongly supports core assets but limits spillover into “long tail” tokens, contributing to sideways price environments for most of the market.

A separate analysis from Finery Markets also reinforces this trend, suggesting that off-exchange trading is playing an increasingly significant role as institutions prioritize order matching quality and payment safety.

Outlook 2026: the crypto cycle may no longer be “clean” as before

Looking ahead to 2026, Wintermute suggests that 2025 could mark the beginning of a shift in the crypto market, moving away from clear up-and-down cycles based on narratives. Future performance will depend on whether liquidity expands beyond a small group of large-cap assets or remains trapped at market peaks.

To reverse this trend, Wintermute states that corporate buyers via ETFs and crypto treasuries need to diversify their investments across more assets. At the same time, core assets must see sufficient growth to trigger broad capital rotation. Another scenario involves a strong return of retail investors, bringing in new funds and a wave of stablecoin issuance, although Wintermute considers this unlikely.