Crypto Market Prepares for Next Big Move as Institutions Drive Buying

The cryptocurrency market has been experiencing a lull lately, but analysts at Wintermute believe that this is not the end. Instead, it's just preparation for the next big move.

Last week was supposed to be disastrous for crypto due to strong labor market data from the U.S., which led to an expected interest rate hike by the Federal Reserve. However, Bitcoin and Ethereum barely reacted to the news and actually closed the week up 3.45%.

According to Wintermute, this resilience can be attributed to investors taking profits in traditional markets and moving their money into crypto. The company's charts suggest that this cycle is fundamentally different from previous ones, with a maximum drawdown of around 50%, compared to over 75% in previous crises.

The reason for this difference is the presence of institutional investors, who are no longer waiting for Bitcoin to fall to an arbitrary level before buying. Instead, they're aggressively investing through spot ETFs, with nearly $1 billion flowing into these funds over the past three weeks.

Wintermute outlines two scenarios for the next stage of the market: if Bitcoin breaks above $82,000, it could lead to a surge in price due to FOMO; on the other hand, if it falls below $72,000 and spot ETFs record heavy outflows, the bullish trend will be put on hold.