Crypto market-maker Wintermute released a report on November 6, 2025, claiming the digital asset market operates in a self-funded phase. According to Cointelegraph, inflows from three primary funding sources have reached a plateau. The company stated that liquidity remains the defining force behind every crypto cycle despite continued blockchain adoption.
The report identified stablecoins, exchange-traded funds, and digital asset treasuries as the three major conduits for crypto liquidity. Wintermute data showed that since 2024, these three sectors expanded from $180 billion to $560 billion. However, momentum has decelerated in recent months. The firm warned that fresh capital deployment has slowed across all three channels.
The company released this analysis through a blog post published on Wednesday. Wintermute argued that while global money supply remained supportive, high short-term rates and elevated Secured Overnight Financing Rate led investors to park cash in US Treasury bills. This dynamic left crypto trading volumes healthy but growth stagnant as money moved between cryptocurrencies without fresh inflows entering the ecosystem.
Internal Capital Rotation Replaces External Growth
The slowdown creates what Wintermute called a player-versus-player market. Short-lived rallies and volatility are driven by liquidation cascades instead of sustained buying pressure. Each conduit reflects a different source of liquidity. Stablecoins track crypto-native risk appetite, digital asset treasuries capture institutional yield demand, and ETFs mirror broader traditional finance allocation trends.
The report emphasized that the problem does not stem from tighter monetary conditions. Central banks started easing after two years of tightening, and aggregate money supply remained supportive. According to CoinDesk, US-listed spot ETFs registered cumulative outflows of over $1.5 billion in less than two weeks. Demand from digital asset treasury firms dropped from third-quarter peaks.
Rachael Lucas, an analyst at Australian cryptocurrency exchange BTC Markets, told Cointelegraph that larger players are doubling down through over-the-counter deals. We previously reported that Bitcoin ETFs accumulated over $65 billion in assets under management by April 2025, demonstrating strong institutional demand despite current outflow trends. A Bitwise report found that 48 new Bitcoin treasuries appeared in just three months.
Market Awaits Revival in Key Liquidity Channels
Wintermute suggested that a revival in any key liquidity channel may signal macro liquidity flowing back to crypto assets. New ETFs, renewed stablecoin minting, or an uptick in digital asset treasury issuance may trigger the next wave. Until this happens, price action may remain directionless despite new developments in blockchain infrastructure.
The report noted that liquidity has not disappeared but is recycling within the system instead of expanding it. Glassnode data from earlier in 2025 showed institutional futures activity at record highs. ETF inflows and CME futures open interest demonstrated clear correlation. The crypto derivatives market surged with institutional activity reaching unprecedented levels.
However, the interplay between institutional and retail behavior complicates market sentiment. Large, rapid redemptions can amplify downward spirals during crises. According to CCN, ETF flows can reverse liquidity as quickly as inflows build it. BlackRock's IBIT posted a record single-day outflow earlier in 2025. Price discovery increasingly happens within regulated ETF and futures channels while spot markets suffer from thinner order books.