Wintermute Analysts Reveal the Reason Behind the Crypto Market Decline

According to experts, of the two main sources of capital inflow into the crypto market — ETFs and stablecoin issuance — only ETFs remain active at the moment. The total supply of stablecoins has increased by $100 billion (+50%) since the start of the year, while ETF inflows have stalled at around $150 billion.

The previous growth model of the crypto market, driven by the launch of exchange-traded funds and institutional investments, has stopped working.
Investors have shifted their focus to stocks, artificial intelligence, and prediction markets.

“The traditional four-year Bitcoin cycle no longer explains market behavior.
The dynamics of halvings have lost their significance, and liquidity has become the main driver of price movements,” — Wintermute analysts noted.

Nevertheless, the structure of the crypto market remains stable: volatility is moderate, and supply on centralized exchanges is limited.
In the near term, sustained growth is unlikely to resume, and the prices of leading crypto assets are expected to move within a narrow range, Wintermute concluded.

Earlier, Tom Lee, chairman of BitMine and co-founder of Fundstrat, pointed out that the crypto market cycle has become longer.
Despite the ongoing decline in prices, he believes that major cryptocurrencies still have a chance to rally before the end of the year.

See also: "BitMine CEO Shares Short-Term Crypto Market Outlook"

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