Institutional Investors Drive New Wave of Crypto Investment

The cryptocurrency market is experiencing a significant shift as institutional investors and AI miners begin to flow money into crypto assets. According to Wintermute, a market maker, this cycle is fundamentally different from previous ones.

Nearly 340 days have passed since the all-time high in Bitcoin's price. In contrast to previous crises where Bitcoin lost more than 75% of its value by this point and remained near the bottom for years, the maximum drawdown this time was only around 50%. Wintermute emphasizes that the bottom of each new cycle is becoming increasingly shallow.

The reason behind this change lies in institutional investors. Major funds no longer wait for Bitcoin to fall to an arbitrary level such as $20,000 but begin aggressively buying through spot ETFs. Over the past three weeks, nearly $1 billion has flowed into these funds, with last Thursday recording the largest inflows since January.

The market has entered a 'young cycle' stage, where capital gradually moves from the largest cryptocurrencies into riskier assets. Bitcoin and Ether provided the initial momentum, and investors are now turning their attention to altcoins. UNI and ARB surged almost 40% over the week, while activity is beginning to pick up in the artificial intelligence sector.