Who will make large-scale low-buying moves in the crypto market? Institutional capital flow analysis

The global capital markets have shown a stark divergence over the past year: the stock market is essentially a low-risk profit paradise, while the crypto market remains a highly challenging battleground. Behind this huge contrast lies a key question—who will become the next major participant in the crypto market? From a globalization perspective, the answer may determine the future market direction.

A-shares are still on the road, short-term corrections are golden opportunities

Looking at the data performance of A-shares, the trading volume has reached 3 trillion yuan, accounting for 2.54% of the total market capitalization. Compared to the 3.37% during the 2015 bull market, there is still room for further breakthrough. Based on this pace, once the trading volume exceeds 4 trillion yuan, it’s advisable to consider moderate risk avoidance.

Another important indicator is the margin financing and securities lending balance, which reflects the market leverage level. Currently, the leverage balance has reached 2.6 trillion yuan, setting a new record high, accounting for about 2.53% of the circulating market value. Compared to the peak of over 4.5% during the 2015 frenzy, the current leverage level remains relatively healthy, indicating that capital inflows are still accelerating and market sentiment is still building.

After 16 consecutive positive days, a 1-2 day sharp decline could occur at any time. This short-term correction is precisely the best entry point; there’s no need to worry excessively. Opportunities for low-cost entry can be found in hot sectors such as aerospace commercial, brain-machine interfaces, and AI applications.

Crypto market selling pressure is easing, dollar-cost averaging zones are emerging

Compared to the booming stock market, the crypto market has been relatively calm recently. From an operational perspective, the best strategy is to wait for a wave of FUD (fear, uncertainty, doubt) events, ideally with a new low, creating an opportunity for low-cost accumulation.

The overall market selling pressure has indeed decreased recently, but new capital inflows are not obvious. However, there is good news worth noting: the Ethereum (ETH) staking withdrawal queue has been nearly zero since early last year. Compared to the peak queue of 2.6 million ETH, the selling pressure has rapidly declined. This indicates that the previously troubling staking withdrawal wave has subsided.

Because of the significant easing of selling pressure, every dip in the current crypto market is a rare opportunity to participate, with high cost-effectiveness. If considering long-term deployment, this position can be viewed as an ideal area for dollar-cost averaging—market volatility becomes an advantage for continuous low-cost buying.

Who will be the protagonist of the next wave of capital? Institutional allocation logic

Under what circumstances is a large-scale return of institutional funds most likely to occur? The answer is when the valuation of the stock market becomes increasingly unattractive and risks continue to rise. Smart money will seek new pools of capital to hedge risks, and the crypto market is their preferred safe haven.

According to Binance’s annual trading data from last year, the scale of one exchange has already reached a level comparable to traditional markets: Binance’s annual trading volume is about 34 trillion USD, compared to 58 trillion USD in A-shares and 50 trillion USD in US stocks, all in the same magnitude. In terms of user base, Binance has 300 million users, A-shares have 250 million, and US stocks 200 million, indicating that the crypto market has evolved into a relatively mature and regulated market system.

It is precisely because of the market scale and participant numbers reaching new heights that the crypto market will gradually become an important target for institutional asset allocation. When traditional stock market opportunities become increasingly scarce, institutions will turn to this previously overlooked market. However, right now, everyone is easily making money in the neighboring stock market—who would want to struggle in a more difficult market? That’s why more patience is needed, waiting for that turning point to arrive.

Conclusion: Those who can seize the turning point are the true winners

The greatest test during this period is participants’ patience and strategic vision. In the short term, A-shares will continue to attract smart money, and the crypto market will remain relatively subdued. But when the valuation advantage of stocks reverses, whoever recognizes the crypto market opportunity first will be able to catch the next large-scale trend. The dollar-cost averaging zones are already emerging; the rest is just a matter of time.