Retail shifts to Bitcoin and Ether after 2025 October crash
Retail investors shifted back toward Bitcoin (BTC) and Ether (ETH) following the Oct. 10 market sell-off, reversing a multi-year preference for altcoins, according to Wintermute’s “Digital asset OTC market 2025” report published on Tuesday.
Wintermute noted that since around 2022, retail participants had been net sellers of BTC and ETH while favoring altcoins. That trend changed in 2025, with the October liquidation event marking “a clear inflection point” that accelerated a rotation into the two largest cryptocurrencies.
The firm said data showed retail accounts were trimming exposure to majors at the time of the crash but quickly moved back into BTC and ETH after the leverage wipeout. Wintermute described this as an immediate shift to a defensive stance amid concerns about contagion risks and a potential bear market.
By year-end, Wintermute reported that retail positioning had aligned more closely with institutional flows, prioritizing liquidity and durability over higher-risk peripheral assets.
Retail’s “defensive consolidation” rotated back into majors. Source: Wintermute
Altcoin rallies lacked momentum
The rotation into majors curtailed prospects for an altcoin season in this cycle, and altcoins “materially underperformed” in 2025, according to the report.
Wintermute said new narratives continued to appear but did not persist. The average altcoin rally lasted roughly 19 days in 2025, down from around 60 days in the prior year, indicating lower conviction and more tactical risk-taking.
From 2022 to 2024, altcoin uptrends typically held for 45 to 60 days, supported by themes such as memecoins and AI. In 2025, the median rally length fell to just 20 days, leaving moves to feel more like short-term trades than durable trends.
Altcoin rallies lasted less than half as long in 2025. Source: Wintermute
Concerns from the October sell-off are easing
While altcoins have yet to establish sustained momentum entering 2026, anxiety surrounding the October decline has moderated, improving sentiment. Earlier this month, Bitwise chief investment officer Matt Hougan said, “One of the reasons I think we’ve rallied to start this year is that investors have put October 10 in the rearview.”
Overall crypto market capitalization reached $3.34 trillion on Wednesday, the highest level so far this year, after rising 10%, or $300 billion, since Jan. 1, according to CoinGecko.
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