BlockBeats News: On January 14, crypto market maker Wintermute analyzed in its digital asset OTC market review: the traditional four-year cycle of Bitcoin in 2025 will show weak performance, and the altcoin cycle will almost disappear. This is not a temporary adjustment, but a structural change. Therefore, for the crypto market to experience a real strong rebound in 2026, it will heavily depend on the following three key outcomes, with at least one of them needing to occur:
ETFs and crypto treasury (DAT) companies are expanding their investment scope beyond Bitcoin and Ethereum. Currently, U.S. spot BTC/ETH ETFs concentrate liquidity heavily on a few large-cap tokens, leading to a narrowing market breadth and significant performance divergence. Only when more cryptocurrencies are included by institutions through ETFs or corporate treasuries can broader market participation and liquidity be restored.
Major assets such as BTC and ETH, along with BNB and SOL, have shown strong performance again, generating widespread wealth effects. However, the traditional 2025 cycle of "BTC rising followed by capital flowing into altcoins" has largely broken down. The average upward cycle for altcoins is now only about 20 days (compared to around 60 days in the previous year), with most tokens continuing to decline due to pressure from token unlocks. Only when top-tier assets surge again is there a possibility of capital spilling down once more, reigniting the altcoin market.
Retail investor attention is returning to the crypto market. Currently, retail investors are still actively participating in the market, but their capital is primarily allocated to high-growth themes such as fixed-income S&P 500, AI, robotics, and quantum computing. The painful memories from 2022-2023 (crashes, bankruptcies, liquidations), combined with crypto's underperformance compared to traditional stock markets in 2025, have significantly reduced many people's perception of crypto's "get-rich-quick" appeal. Only a large-scale return of retail investors will reignite the market's frenzied momentum.