Institutions Favor BTC and ETH Amid Retail Memecoin Trend

A recent report from Wintermute, a crypto trading firm, reveals stark contrasts in the investment approaches of retail investors and institutions during the bull market of early 2025. While institutions are heavily investing in leading cryptocurrencies like Bitcoin and Ethereum, retail investors are gravitating towards meme coins and altcoins. The difference in allocation between these groups has reached a historic 30 percentage points. Institutions now allocate 67% of their resources to major cryptocurrencies—predominantly through ETF inflows—while retail investors have reduced their major allocations by 9%, now sitting at 37%. This suggests a clear shift in retail interest toward newer, riskier assets. Wintermute's CEO, Evgeny Gaevoy, remarked, "This divergence isn’t temporary; it indicates a more sophisticated crypto market. Institutions view crypto as a macro asset while retail traders chase trends." In the first half of 2025, institutions have increasingly turned to derivatives for hedging, yield generation, and more efficient capital exposure. Notably, the volume of over-the-counter (OTC) options has surged by 412% compared to the same period in 2024. Memecoins such as BONK, WIF, and POPCAT have become popular, even as larger players like DOGE and SHIB see a decline in their market dominance. Nevertheless, DOGE, SHIB, and PEPE remain the top three memecoins on the GMCI MEME Index. As the market looks towards the second half of 2025, potential decisions regarding spot Dogecoin ETFs by the SEC in October may significantly affect retail demand, with Grayscale, REX-Osprey, and Bitwise all applying for new ETFs this year. Note: The Block is an independent media entity providing news and data. As of November 2023, Foresight Ventures holds a major stake in The Block. Foresight is active in crypto investments, with Bitget as a primary LP. The Block maintains editorial independence to ensure unbiased reporting on the crypto sector. This article serves informational purposes and isn’t financial advice.