Institutional traders dominated spot trading on the market maker’s desk during the first half of the year, reshaping how crypto assets move.
Institutions accounted for 72% of spot trading volume on Wintermute’s OTC desk during the first half of 2026, the highest share on record and a sharp increase from 61% in the second half of 2025, according to a report from the market maker.
The shift reflects how institutional investors operate under defined mandates and risk limits, holding positions over longer periods than retail traders. As a result, the structure of crypto markets has become easier to observe. “As crypto works through a bear market, with retail largely absent and preoccupied with equities, the structure underneath is easier to see. The asset class is maturing, whatever recent price action suggests,” Wintermute stated
Volatility declines as institutional capital concentrates
Realized volatility has fallen from approximately 70% in earlier market cycles to around 45% in the current cycle, a direct consequence of institutional dominance. Institutional investors trade a relatively narrow universe of tokens while retail investors spread activity across a larger number of assets, creating a structural imbalance.
“The result is a market where the flow that increasingly sets direction is concentrated in fewer names, traded more selectively,” Wintermute noted. Broad-based altcoin rallies are becoming less likely as institutional capital focuses on a handful of assets. This concentration has reshaped derivative markets as well: altcoin options notional trading volume on Wintermute’s OTC desk increased 3.4 times from H2 2025 to H1 2026, driven largely by investors seeking yield.
Contracts for difference and tokenized assets gain traction
Contracts for difference (CFDs) are being used across a wider range of cryptocurrencies for directional trading, hedging, and basket strategies, expanding the toolkit institutional traders employ. Meanwhile, tokenized real-world assets climbed nearly 50% to $31 billion in H1 2026, with average monthly transfer volume more than doubling to $9 billion.
Institutions primarily adopt tokenized Treasuries, money market funds, and private credit, while retail investors remain more active in tokenized equities. The divergence underscores how institutional and retail capital are gravitating toward different segments of the emerging tokenized asset ecosystem.
Institutional influence expected to persist
Wintermute expects retail participation to return during the next crypto bull market but argues institutional influence is unlikely to fade. The structural shift toward institutional dominance has already reshaped volatility, asset concentration, and the mechanics of how price discovery occurs across major and minor cryptocurrencies alike.
