A recent report by Wintermute reveals a significant shift in cryptocurrency liquidity, with Bitcoin and Ethereum dominating the landscape as altcoin share dwindles. The proportion of liquidity attributed to altcoins has fallen from 15% to 12% over the past two years, highlighting a trend towards concentration in major cryptocurrencies.
This transformation is attributed to an influx of institutional investors, including asset managers utilizing ETFs, who are focusing their investments on more established coins. The shift has also altered traditional trading patterns, leading to shorter durations for altcoin price rallies—averaging just 19 days in 2025 compared to 61 days in 2024.
Wintermute's findings indicate that institutional traders are becoming more tactical, reacting to market news rather than maintaining confidence in price trends. As derivatives markets expand, particularly the rise of contracts for difference (CFDs), institutions are adapting their trading strategies to navigate the evolving market.
