Wintermute calls the end of the four-year crypto cycle and highlights the 2026 triggers

Wintermute says the four-year crypto cycle is over and institutional capital flows now determine market performance.

According to trading firm Wintermute, the well-known four-year boom-and-bust pattern in cryptocurrency may have come to an end.

In a recent analysis, the firm argued that market performance is now dictated by institutional capital flows rather than historical narratives associated with Bitcoin’s halving events.

This shift means that a broad market recovery in 2026 is not guaranteed and depends on specific catalysts that can refocus concentrated liquidity.

A new market structure is emerging

Wintermute’s review declared that the “four-year cycle is dead.” The company bases this on its own over-the-counter trading data from 2025, which showed a break in the traditional pattern of capital flowing from Bitcoin gains into Ethereum, then into other major tokens and finally into smaller altcoins. Instead, 2025 became a year of ‘extreme concentration’.

The introduction of spot Bitcoin and Ethereum exchange-traded funds (ETFs), amid sustained demand for these assets, created what Wintermute calls “walled gardens.” New institutional liquidity was largely limited to a handful of large-cap assets and did not flow into the broader crypto market.

This dynamic has contributed to short-lived altcoin rallies, which the company said lasted an average of just 20 days in 2025, compared to 60 days in 2024. At the same time, retail investor attention was often focused on stock markets in areas such as artificial intelligence (AI), leaving the crypto market without a significant source of new capital.

Paths to a broader recovery

To grow the market beyond its current concentrated state by 2026, Wintermute has identified three necessary triggers. The first is an expansion of the ETF and Digital Asset Trust (DAT) mandates to include more cryptocurrencies.

You might also like:

The company has seen early signs of this, including signups for Solana and XRP ETFs. According to data from SoSoValue, spot XRP ETFs had resumed a series of net inflows late last week after a brief lull.

According to Wintermute, the second path is strong price performance of BTC or ETH itself. A big rally in both could generate a wealth effect that spills over to other digital assets, reviving the capital transfer that last took place in 2024. Analysts debate the likelihood of this, with some, such as Egrag Crypto, assigning a 55-65% chance of a positive year for Bitcoin if it maintains key price levels.

The third, and least likely, catalyst is a return of retail investor mindshare to crypto from other speculative asset classes, which would lead to new capital inflows and the production of stablecoins.

Data from Santiment shows that underlying network growth is possible even without immediate price spikes, as Ethereum set a record for new wallet creation on January 11, 2026, with 393,600 new addresses per day, thanks to lower fees and stablecoin usage.

The overall direction for 2026, as set out by Wintermute and echoed by commentators, will be determined by whether any of these triggers can successfully increase liquidity. Changes in the structure of the market now depend on the dynamics of capital flow, rather than a predictable historical clock, for future performance.