The crypto market is maturing and diversifying thanks to improved regulatory clarity and increasing demand from traditional financial institutions, says trading firm and over-the-counter (OTC) desk Wintermute.
In its 1H 2025 OTC Market Report, the firm detailed the changes in the crypto trading market. The report highlighted a growing divergence between institutional investors and retail based on data gathered from its OTC desk which indicates institutions are maintaining larger allocations to Ethereum and Bitcoin when compared to retail investors.
“Institutional and retail crypto strategies are moving in opposite directions,” the firm posted on X (formerly Twitter). “Institutions maintained 67% allocation to BTC and ETH, while retail dropped to 37% as they rotated into altcoins.”
According to the firm, which claims to average more than $15 billion in daily trading volume, spot volumes running through its OTC desk have grown by more than 2.4x that of volumes on centralized exchanges. The bulk of that growth comes from institutions and retail brokers, as volume from crypto natives declined.
Traditional finance accelerated its crypto adoption at unprecedented levels
TradFi institutions are increasingly moving onchain, with tokenized platforms gaining traction and pilot equity offerings underway
→ This marks a shift from indirect exposure to direct participation pic.twitter.com/Dads9LaYHW
— Wintermute (@wintermute_t) July 15, 2025
“Counterparties continue to seek efficient ways to execute larger trades, and as institutional participation grows, there’s a rising preference to trade without the need to hold assets on exchange platforms,” Wintermute said.
One particular trade type that surged when compared to the first half of 2024 was options trading, which jumped 412% in the first half of 2025 on Wintermute’s OTC desk. This trade flow was dominated by trading of Bitcoin and Ethereum, which composed96% of all options trading.
That focus on crypto’s two largest assets, is where institutional and retail buyers are beginning to diverge for the first time since the last bull market according to the firm.
“After spending much of 2024 moving in relative sync, both rotating into smaller, high-beta tokens, retail and institutional investment focus has started to diverge in 1H25,” Wintermute wrote. “Institutions have stopped rotating out of majors, specifically BTC and ETH, something that happened in the previous two years, while retail continues to push deeper into altcoins.”
Furthermore, the firm indicated that retail “rotated earlier into emerging narratives like stablecoins,” while institutions preferred “infrastructure themes.”
Those changes reflect “a shift in risk appetites and is an early sign of markets maturing,” Wintermute said.
Signs of institutional acceptance and mainstream adoption of crypto have become more apparent since President Donald Trump was elected in November. The administration has become more friendly to crypto firms, with the SEC ending investigations and lawsuits into many of the ecosystem’s top companies.
Furthermore, the success of Bitcoin and Ethereum ETFs and the growing trend of crypto treasury vehicles has validated interest from the world’s biggest capital allocators and the largest companies–a sign that many view digital assets as a legitimate investment vehicle.
