Next Altseason Could Favor Fewer Crypto Tokens, Wintermute Warns

Highlights:

• Wintermute says institutional investors may narrow the next altseason by concentrating capital in fewer established crypto assets.
• Institutions generated a record 72% of Wintermute’s OTC spot trading volume during the first half of the year.
• Shorter altcoin rallies and stronger derivatives demand suggest future gains could favor liquid, established tokens.

The next crypto altseason may produce fewer winners as institutional investors direct capital toward a smaller group of established tokens, according to Wintermute. The crypto market maker shared the outlook in its Digital Asset OTC Flow: The Institutional Effect report published on July 30.

Altseason usually refers to a period when many cryptocurrencies outside Bitcoin record strong gains. However, Wintermute’s trading data suggests that the next market-wide rally may not lift hundreds of altcoins together. Instead, large investors are becoming more selective about where they place their money.

The report found that institutions accounted for a record 72% of spot trading volume on Wintermute’s over-the-counter desk during the first half of this year. Their share increased from 61% in the second half of last year. Over-the-counter, or OTC, trading allows investors to complete large transactions directly instead of placing orders on public exchanges. Professional investors often use these desks to reduce price disruption when buying or selling large amounts of cryptocurrency.

72% of the spot flow through our OTC desk now comes from institutions, the highest share on record

Hedge funds, DATs, asset managers, family offices

Up from 59% in 1H25 and 61% in 2H25

At three quarters of volume, institutional flow defines market structure pic.twitter.com/CCerQIKdAg

— Wintermute (@wintermute_t) July 30, 2026

Altseason Liquidity Shifts Toward Fewer, Stronger Altcoins

Wintermute said the growing institutional presence is concentrating market liquidity in fewer digital assets. Large investors generally prefer tokens with deeper liquidity, stronger market infrastructure and clearer investment reasons. Their approach differs from retail traders, who often spread money across a wider range of smaller tokens and follow short-term market trends. Institutions usually operate under stricter risk rules and are less likely to buy an asset only because its price is rising.

Therefore, a future altseason could be more selective than previous cycles. Bitcoin, Ethereum and a limited number of large or well-established altcoins may attract most of the available capital. Smaller projects could struggle to benefit unless they have strong demand, useful products or enough liquidity to support large trades.

Wintermute’s earlier market research also found that the average altcoin rally lasted about 19 days in the previous year, compared with around 60 days in 2024. The shorter rallies showed that traders were becoming more tactical and less willing to hold altcoins for long periods.

Crypto Options Show More Careful Positioning

Institutional investors are also increasing their use of crypto derivatives. According to Wintermute, altcoin options volume on its OTC desk rose sharply during the first half of 2026. Options allow traders to gain exposure, protect existing positions or generate income without simply buying a token and waiting for its price to rise. Their growing use suggests that professional investors are following more controlled strategies instead of making broad bets on the entire altcoin market.

Demand has also expanded into tokenized real-world assets. Their total value reached about $31 billion during the first half of 2026, nearly 50% higher than before. Average monthly transfers rose to around $9 billion. Institutions mainly focused on products linked to U.S. Treasuries, money market funds, and private credit.

There is a chance that retail traders could come back to the market if crypto prices start recovering. Nonetheless, the data provided by Wintermute proves that institutions will be able to affect the decision on what kind of digital assets to allocate capital to.