Post #8436

📉 Why Crypto Lags While Global Markets Boom Just before the recent sell-off, market maker Wintermute released a macro report explaining why digital assets are underperforming while the rest of the risk market rallies. ➡️ The Macro Picture Looks Strong The global backdrop is favorable. Rates are coming down, quantitative tightening has ended, and equities sit close to record highs. On paper, this should support risk assets. Yet crypto continues to lag. After the latest FOMC meeting, the probability of another rate cut in December fell sharply, triggering a brief wave of risk aversion. Stocks stabilized quickly, but crypto failed to bounce. ➡️ Liquidity Exists but Flows Elsewhere The key issue is not a lack of liquidity but where it goes. Global liquidity is expanding, yet little of it reaches crypto. Stablecoin supply has grown by more than fifty percent this year, which means capital is available. But inflows into Bitcoin ETFs have stalled near 150 billion dollars, and trading activity across digital asset venues has dropped sharply. The flow that once powered the market has shifted toward equities, artificial intelligence, and other trending sectors. ➡️ The Market Structure Is Healthy Despite a 1.7 billion dollar liquidation wave, leverage across crypto has declined, open interest has reset, and volatility remains controlled. The market looks cleaner than during previous crises. Bitcoin holds its ground thanks to steady ETF inflows and low exchange supply, while Ethereum and several L1 and L2 tokens show early signs of relative strength. ➡️ The Four-Year Cycle Is Over Wintermute notes that the halving narrative no longer drives performance. Miner supply and issuance schedules have lost their influence in a maturing market. The main force now is liquidity flow. When ETF inflows resume and trading activity revives, that will likely mark the start of the next sustained rally. ➡️ What to Watch Next ETF demand, DAT trading volume, and continued stablecoin growth remain the three signals to monitor. They will show whether capital is finally rotating back into crypto. The report concludes with one clear message. The macro environment supports risk assets, but the direction of liquidity decides where returns appear. For now, most of that capital still favors traditional markets rather than digital ones. 🐴Powered by White Horse