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Bitcoin spent most of 2025 above $90,000. Ethereum held steady through the year. Analysts hailed it as the year crypto became a mature asset class.Meanwhile your altcoin portfolio is down 95% and crypto twitter has turned into a support group for traumatised gem hunters learning to trade perps. The bulls always say ‘this time is different’; and for once, they were right, but for all the worst reasons.Today, we find out what actually happened in this cycle, and what it means for crypto’s future.
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📜 Disclaimer 📜
The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial, legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading stocks poses considerable risk of loss. The speaker does not guarantee any particular outcome.#Crypto #Market #Altseason
Hello and welcome to Coin Bureau's official podcast channel.
My name is Guy and if you're seeking unbiased in-depth information about Bitcoin,
cryptocurrencies, Web3, and all manner of related topics,
then you've come to the right place. I hope you enjoy today's episode.
Bitcoin spent most of 2025 above $90,000. Ethereum mostly held steady throughout the year.
Analysts hailed it as the year crypto became a mature asset class.
Meanwhile, your altcoin portfolio is down 95%,
and crypto Twitter has turned into a support group for traumatized gem hunters
learning to trade perps. The bulls always say this time it is different.
And for once, they were right, but for all the wrong reasons.
Today, we find out what happened this cycle, why, and what it means for crypto's future.
My name is Lewis and you're watching the Coin Bureau.
Before we begin, I'm not a financial advisor and nothing in this video is financial advice.
It's just what we learned from a new industry report offering answers to some of the biggest
questions hanging over the crypto market today. If you find our videos useful,
well, smash that like button and let's get into it.
Now, when you get burned in the markets, you've got two options,
become disillusioned and tune out, or lock in and learn how you could position yourself better
in the future. If you're doing the latter, you clicked on the right video.
Today, we're bringing down Wintermute's 2025 OTC trading report.
Basically, a market year in review. Wintermute is one of crypto's top market making firms.
And whatever you think of market makers,
few participants are well positioned to understand exactly what is going on in the market
at any given time. Many expected 2025 to be the explosive climax of before your cycle.
All the pieces seemed to have finally fallen into place, Wall Street, and even the White House
had pivoted hard into crypto. The SEC dragon was slain, and Gensler and SPF were down and out.
Even Trump and CZ were back in, or at least out, in CZ's case.
And if you held Bitcoin, you probably had a good year.
As Wintermute's report points out, there was no failed bull market.
The price of BTC appreciated more than eightfold between the bottom of 15,000
in late 2022, and the all-time high of 126,000 reached last summer.
But for our many comrades who don't own much Bitcoin and instead hung their fortunes on an
always just around the corner altcoin season that would multiply their net worth, well,
it was a sobering year to put it mildly.
According to Wintermute, this was the year the four-year cycle broke permanently.
Instead of traditional seasonality, their OTC data shows a year of endless chop,
punctuated by short-lived trends rather than long seasonal swings.
The predictable patterns that used to tell you when to buy and sell essentially vanished.
So, for example, that law of nature that says that the crypto market pumps every October,
regardless of fundamentals, yeah, that one was a no-show in 2025.
Activity was concentrated early in the year, with a strong start followed by a grueling
softening through spring and summer. Optimism around the new pro-crypto-US administration
quickly dissipated. Risk sentiment deteriorated sharply by the end of Q1,
as the meme coin and AI agent narratives died down. Trump's tariff announcement on April 2
was a particularly sharp nail in the coffin. But, as you could tell from the price of Bitcoin,
it wasn't that the money flowing into crypto dried up. It just got stuck in silos beyond the
reach of crypto Twitter. Trading activity concentrated into BTC and ETH, while only a select group
of altcoins captured the bulk of trading activity. This reflected the gradual expansion of ETFs
and digital asset treasuries, or DATs, to larger altcoins as well as the collapse of the meme coin
cycle in early 2025. Capital came in, hit the majors, and just called it a day. This pulled the
rug out from under altcoin holdlers, expecting a rotation of market participants taking profits
from BTC and reinvesting them further along the risk curve. Wintermute describes this as
liquidity becoming, quote, more concentrated and unevenly distributed, driving greater
divergences and returns and activity. Which is a roundabout way of saying that the rising tide
that was supposed to lift all boats, well, it got trapped in the harbor.
Where capital used to flow freely between assets, it now hit structural barriers that didn't
exist in previous cycles. And this looks like a permanent change. So if you want to survive in
a new crypto market, you may want to reconsider everything you thought you knew about how it's
post-work. In 2020, the game was relatively simple. Money came in through Tether, bought Bitcoin
on Binance, rotated profits into ETH when Bitcoin got boring, then spilled into altcoins when
people wanted more than 15% gains. ETH would pump, those profits would spill into D5, and eventually
the whole circus would arrive at NFTs and microcaps. Everyone used the same rails, and the liquidity
was fungible. But that world ended in 2025. As Wintermute points out, the main gateways for
capital entering the market are now ETFs and DATs. Many of us welcomed the opening of these new
gateways, because nothing says number go up like institutional adoption, right? But as it turned
out, these gateways are also prisons, and ETFs that holds Bitcoin cannot sell that Bitcoin to
buy Solana. It is legally mandated to hold only the specific asset written into its prospectus.
The fund manager can't wait gut one morning and decide to rotate into altcoins, no matter how
bullish the chart looks. A digital asset treasury with billions of dollars in BTC isn't rotating
into altcoins either, thanks to corporate mandates and shareholder expectations that keep that capital
locked in place. So these vehicles are structurally bound to majors, providing death to the top of
the market while starving everything else below it. And so the wealth effect that used to reliably
follow fresh highs for BTC in previous crypto market cycles was largely absent in 2025.
Now this new playing field went through an extreme stress test on October 10th, which marked the
largest liquidation event in the history of crypto by a very wide margin. The trigger was
ostensibly Trump's announcement of new 100% tariffs on goods from China. But questions remain
as to why crypto nuked so much harder than any other asset class. At any rate, it was a bloodbath
for the history books, with $19 billion in open interest liquidated in a matter of hours. OI
stood near $230 billion going into the event, with around 70 billion of that concentrated
outside BTC and ETH. Leverage had built unevenly, particularly in altcoins. Classic late cycle
behavior from traders betting on a rotation that never came. The 1010 event triggered a forced
violent capitulation that washed a lot of people out of the game entirely. And cut that $70
billion altcoin OI down to around $30 billion by mid-December. And what happened next is the
most telling observation in Wintermute's entire report. In the aftermath of 1010, retail didn't
rotate back into altcoins after the flush. They weren't spying the dip on their own destroyed
backs. Instead, they appeared to have funneled whatever was left of their portfolio into majors
and BTC. The same siloed, mature asset that had already outperformed everything else and
apparently topped in early October. As fear overtook greed, retail converged with institutional
positioning, apparently giving up on the dream of 100 X gains and licking their wounds instead.
Now, when leverage on wines and prices gap, the only assets with enough depth to absorb
selling pressure are the ones inside the same silos as institutional investors. Everything else
becomes exit liquidity. Case in point, Cosmos' native token, Adam, a well-established crypto,
far from a memecoin or microcap, briefly collapsed from $4 to $0.001 on Binance. So, if you had
to pinpoint the moment, when the alt season dream died, it has to be October 10th. Not because
people stopped wanting it, but because the market structure no longer supports it. Capital enters
through mandate-bound channels that physically cannot rotate. And when retail gets scared,
they flee to the same assets institutions are locked into by law. And by the way, if you find
these market insights useful, well, you can get much more out of them delivered straight into your
inbox, there are free weekly newsletter. You can sign up for a breakdown of all of the biggest
stories in crypto each week using the link in the description. We've also secured exclusive
deals for viewers of this channel, including discounts on hardware wallets, sign up bonuses,
and trading fee rebates on the best crypto exchanges. And a lot more. So, if you're interested in that,
well, you can find out more by using the QR code right over here or by clicking the link in
the description below. Now, the new dominance of ETFs and dads in crypto money flow helps
explain why altcoins didn't get to bid last year, but they don't explain why retail stopped
showing up in the first place. For that, you need to look at what else was happening last year,
and where crypto ranked in the attention economy. Wintermute ran the numbers on a cross-asset
analysis, and the results paint a sad picture of crypto. Space stocks were up 64% for the year.
Quantum computing gained 34%. AI stocks climbed 31%. Meanwhile, BTC was down 7%.
ETH dropped 15.1%, and altcoins fell 18%. If there was a narrative war in 2025,
crypto certainly didn't win it. The same casual retail investors who were probably buying Bitcoin
spot ETFs when they were the hottest assets around in 2024, well, they likely moved on.
As Wintermute puts it, these alternative assets quote,
offer similar risk profiles, narratives, and return potential, but without the structural barriers
strangling crypto. Basically, AI stocks became the new casino, and House odds looked better.
Wintermute's regional flow data shows how investors around the world rotated in waves,
rather than fleeing in unison. For example, when Trump introduced tariffs early in the year,
the US and Europe were still net buyers of crypto, while Asia was smashing the cell button.
Europe redistributed more gradually, with selling activity building throughout the summer
before easing. The US increasingly started net selling into your end,
as macro uncertainty ramped up, and the Federal Reserve started making hawkish noises.
One of Wintermute's more damning findings concerned the shortening lifespan of narratives
in the crypto market. In 2024, when a narrative took hold, AI agents, memes, whatever the flavor of
the month was, it lasted roughly 61 days. You had two months to identify the trend,
position yourself, and exit before the music stopped. In 2025, that window collapsed to 19 days.
So, less than three weeks from narrative inception to exhaustion. By the time someone made a
YouTube video explaining why a particular sector was hot, the smart money had already sold the top.
We remember crypto Twitter complaining in 2024 that the market was too pvp, but compared to 2025,
in those days, we were still in easy mode. Wintermute attributes the increasing brevity of the markets,
to quote, market fatigue after last year's overshoot, which is a polite way of saying people got
burned too many times, and they just simply stopped believing. Individual themes periodically
attracted attention, notably the perp dex wars, but also meme coin launch pads and emerging
payment primitives, but none of them sustained momentum. Projects kept trying to generate the
kind of narrative that used to drive altcoin rallies, but conviction failed to build each time.
This is what market exhaustion looks like. There was no shortage of narratives in crypto,
but the demand needed to sustain any of them dwindled severely in 2025. The capital that used to chase
them was busy making 60% returns in space stocks instead. Then, as a result, altcoins materially
underperformed. Another major theme in wintermute report is the rise and rise of OTC crypto
derivatives. As position sizes get larger and market volatility continues, these are becoming the
preferred venue for institutions to trade with size, discretion, and control, and to tailor strategies
for any market conditions. This was the case for wintermute's own OTC desk in 2025,
where options trading volume leapt up 2.5x year on year. But it's not just that more people
were trading options. The way they were using them has changed completely. In 2020, most options
volume came from retail buying calls, like lottery tickets on Bitcoin hitting $200,000. You pay
the premium to buy the option. If Bitcoin moons, you win huge. If it doesn't, well, you lose what
you paid for the ticket. That strategy creates explosive upside pressures because everyone's betting
in the same direction. Every dip gets bought because thousands of callholders need the price to go
up. But last year, institutions started selling those calls instead. Wintermute's data shows a
clear shift in the mix of BTC options flow towards yield generation and structured repeatable
strategies. The playbook is straightforward. Own the Bitcoin, sell you the call option,
pocket the premium. It's yield farming with extra steps, and it's capital efficient since
you're generating income on an asset you're holding anyway. Problem is that when you're the one
selling lottery tickets, you don't want the jackpot to be hit too often. And yield strategies
became even more common throughout 2025, with investors selling puts and covered calls to earn
income, adding steady option supply to the market. At the same time, demand for downside protection
stayed strong through continued use of long puts. The market focused more on earning yield and
managing risk than betting on further upside. And look, if this town's boring to you, stop right
there because you would need to understand what this means for the price of Bitcoin. Institution
selling call options against their Bitcoin holdings means that Bitcoin starts rallying hard
those short calls move into the money. That means the institution is now on the hook to deliver
Bitcoin at the low market prices. To hedge that risk, they have to sell their spot Bitcoin.
The bigger the rally, the more they have to sell. This is a standard risk management technique
called delta hedging, and there's nothing sinister or manipulative about it. But the effect is
miserable all the same. Every time Bitcoin tries to moon, there's a wall of institutional selling
that reliably shoots it down. You could think of it this way. The old market had gamblers buying
lottery tickets, creating explosive demand every time the price dipped. The new market has casinos
selling lottery tickets and hedging their exposure by selling into rallies. The house always wins,
but only if the jackpot doesn't pay out too often. Wintermute lays this out with the options
flow data from 2025. Naked call buying declined significantly, reinforcing that options are being
used less to speculate on upside exposure and more for systemic execution. So the market became
deeper, more liquid, and less volatile. Sophisticated counterparties played a bigger role,
marked by more deliberate recurring execution that broke away from previous seasonality cycles.
Now, of course, options aren't the only option on Wintermute's derivatives menu.
The number of cryptos used as underlying for contracts, for difference, or CFDs at their OTC
desk, grew from 27 in Q4 2024 to 46 by Q4 2025. If you're not familiar, you could think of CFDs
as a kind of bespoke perpetual futures contract for institutions. Like perps, CFDs are a
capital-efficient way to access a wide set of assets and sizing options. But even here, Wintermute says
these instruments mainly benefited portfolio management strategies last year, and not so much
the institutions betting on explosive moves. In other words, that's more signs of that market
maturation all around. This is great news if you're an institution managing billions of dollars
and trying to generate steady returns with controlled risk. But for the retail investor holding
on to all coin bags and waiting for that one last Bitcoin pump that will finally cause profits
to spill over, well, this is not how 2025 was supposed to go. The explosive moves that defined
previous cycles are being suffocated by sophisticated strategies designed to extract steady income
rather than chase moon shots. The market now rewards patience, capital efficiency,
and professional execution, and it actually punishes the kind of wild volatility that used to
create altcoin seasons. Wintermute's report draws a blunt conclusion about the crypto market.
You have probably guessed by now, but the takeaway is that the traditional four-year cycle
is becoming obsolete. In their words, quote, 2025, provided evidence that market performance
is no longer dictated by a self-fulfilling for your narrative. The predictable post-haven
euphoria, the alt season rotation, the rising tide lifting all boats. Well, these are outdated
expectations that no longer fit the structure of the crypto market. What comes next depends on
whether liquidity can actually spread beyond the handful of majors that absorbed everything
in 2025. Wintermute suggests three ways that that could happen. First, would be if the ETFs
expand their mandates to include other assets. If they do that, the floodgates open.
There are already filings for a large number of altcoin ETFs sitting with regulators.
If approved, mandate-bound capital gets new destinations beyond just BTC and ETH.
The question is whether approval actually translates into flows, or whether institutions just
get permission to hold assets that they have no interest in buying. The approval timeline depends
on regulators, which means really it's anyone's guess. Second, is that if Bitcoin explodes upwards,
rallying so hard that the wealth effect overwhelms the structural hurdles to an altcoin season.
If prices get really extreme, even mandate-bound capital could start to leak. Corporate
treasuries might rebalance. Funds could take profits, and retail could once again feel wealthy
and euphoric enough to reinvest their gains into altcoins. But this requires BTC to go
significantly higher than current levels, enough to overcome the delta hedging pressured
from all of those institutions selling covered calls. Not impossible, but, you know, that's a big
ask. Third, mind-share returns to crypto. Tech stocks plateau, the AI bubble cools off,
and retail capital rotates back to crypto with fresh enthusiasm. Wintermute marks this as the
least likely scenario, and it's not hard to see why. It requires both conditions simultaneously.
Stocks get boring, and crypto developing a narrative compelling enough to win back attention.
That's a high bar when every week there's a new headline about data centers in space,
precious metals outperforming everything, Rhyam facing a generational supply squeeze,
and so on and so forth. For now, say a prayer for the market that used to reward buying a particular
flavor of altcoins because it's XYZ narratives turn. RIP. Crypto's easy money era is apparently
history, and if you want to succeed in 2026, well, you may need to let go of some old assumptions,
and really take a fresh look at the market as it exists now. And if this has got you wondering
how to best 2026 prove your portfolio, or if you should even hold crypto at all this year,
well, I've got good news for you. We've made a whole video about what strategies could sink
or swim this year, and why. If that sounds useful, then you can check out that video right over here.
That's going to be all for me for today, though. As always, thank you so much for watching,
and I'll see you next time. It's Lewis over and out.
Hello, Guy again. Before you go, if you have a moment, please do rate and review us.
It really helps the podcast grow and find new listeners.
Okay, that's all for this episode. Thank you for listening, and see you again soon.



