Wintermute said it’s the first time since the last bull run they’ve identified this divergence between retail and institutional customers. The firm suggested it reflects the growing maturity of the digital assets market.
Wintermute’s data also indicates that TradFi has been dominating crypto inflows in the first half of 2025, as retail pulls back amid weak altcoin narratives and waning enthusiasm.
Increased regulation coupled with strong institutional adoption has the digital asset market showing signs of maturity and diversification, the algorithmic crypto trading firm, Wintermute, has claimed in its H1 2025 over-the-counter (OTC) Market Review.
Wintermute highlighted an emerging split it identified between its retail and institutional OTC customers as evidence of the market’s maturation. Its data showed:
Retail accelerated their rotation out of larger cap cryptos like Bitcoin and Ether into altcoins in the first half of 2025.
Its institutional client base has continued to accumulate the two largest cryptocurrencies.
Institutional and retail trading strategies have diverged significantly for the first time since the last bull market, indicating a more mature and specialised digital asset market.
Wintermute OTC Market Review 1H25 The percentage of inflows from institutional and retail investors going into BTC and ETH had moved in-sync in 2023 and 2024. But in the first half of 2025 there was a divergence: the institutional rate stayed at 67%; the retail rate fell from 46% to 37%.
Wintermute said this divergence is likely due to the confluence of a few factors. On the institutional side, these investors generally have much less freedom to play the altcoin markets than retail because of “liquidity limitations and mandate contraints”. At the same time, BTC and ETH have become more attractive investments for institutions due to the strong performance of BTC and ETH ETFs and the emergence of corporate treasury strategies.
Retail, on the other hand, usually has a high degree of freedom to rotate into smaller altcoins. That gives these investors more scope to explore narratives such as decentralised AI (DeAI), decentralised finance (DeFi) and decentralised physical infrastructure (DePIN).
Wintermute said the split indicates “the crypto market just hit an inflection point”, and added that it was “reshaping everything from trading patterns to sector flows”.
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Institutions and Retail Brokers Dominating OTC Inflows: Wintermute
Wintermute’s data also showed that OTC trading in the first half of 2025 was dominated by TradFi institutional investors and retail brokers, which the report’s authors conclude is evidence of crypto gaining further mainstream traction.
Institutional adoption has grown, supported by increased regulatory clarity, while mainstream advisory is pushing to allocate a higher share of portfolios to crypto, which is driving retail participation.
Wintermute OTC Market Review 1H25 At the same time, crypto native retail investors appear to have pulled back. The report’s authors interpret this as reflective of the relative weakness of altcoin-related narratives and the dominance of the regulation narrative since Trump’s inauguration.
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In an analysis of how different sectors performed in the first half of 2025, Wintermute said both its institutional and retail customers pulled back from higher risk sectors such as DePIN and DeFi. Institutional clients poured into centralised finance, driven by interest in Binance’s BNB and Crypto.com’s CRO tokens.