Crypto Market Relies on Internal Fund Rotation as Liquidity Inflows Slow, Wintermute Warns
Wintermute, one of the most prominent market makers in crypto, has raised concerns over dwindling liquidity inflows. The current market movements are now driven by internal fund reallocation rather than fresh capital, limiting growth potential.
Stablecoins, ETFs, and DATs have expanded from $180 billion to $560 billion since early 2024, but momentum has stalled. Capital is rotating within the market instead of entering anew—resulting in short-lived rallies and narrowing breadth.
True recovery may hinge on renewed external inflows. Despite broader expectations of monetary expansion, crypto investors remain cautious, potentially setting the stage for a bear market.