ETF Boom: How Institutions Are Rewriting the Crypto Market

Since 2024, both Bitcoin and Ethereum ETF markets have experienced unprecedented capital inflows. U.S. Bitcoin ETFs alone now hold 1.3 million BTC worth nearly 120 billion USD, or more than 6% of Bitcoin’s total market capitalization. The figure is particularly striking considering that ETFs are buying significantly more BTC than miners produce.

Since the launch of ETFs by BlackRock, Fidelity, Bitwise, and others, only 370,000 BTC have been mined, while net inflows to funds reached almost 610,000 BTC — nearly twice as much.

A similar trend is emerging in Ethereum ETFs. Institutional investors are rapidly increasing exposure, and in certain weeks ETH fund inflows even exceed Bitcoin. Total assets under management in ETH ETFs already amount to 15 billion USD, representing roughly 4.6% of Ethereum’s total supply.

These figures highlight not only growing institutional interest but also the acceleration of crypto assets being integrated into traditional investment portfolios.

Why Capital Inflows Will Continue to Grow

Asset managers and analysts expect demand to accelerate next year. The most concrete forecast for 2026 comes from Bitwise — a leading provider of institutional crypto investment research.

The report states:

“We expect institutional investors to allocate approximately 120 billion USD by the end of 2025, and around 300 billion USD to Bitcoin in 2026.”

This projection appears realistic, as ETF growth is typically most aggressive in the first years after launch. Bitwise estimates annual inflows of roughly 100 billion USD, equivalent to double the current net investment level in Bitcoin ETFs.

If Bitcoin ETFs follow a trajectory similar to the first gold ETF, inflows could triple by the fourth year, reaching more than 100 billion USD per year by 2027.

It is important to note that capital inflow is not the same as assets under management, since, for example, Grayscale was structured as a trust for years before being converted into an ETF.

Today, the total assets under management of Bitcoin ETFs amount to 120 billion USD.

What This Means for Retail Investors

For retail investors, the trend has two key implications:

  1. Lower volatility. Persistent ETF inflows reduce selling pressure and stabilize the market.

  2. Growing supply shortage. The more BTC is locked in long-term index products, the tighter the circulating supply — historically a strong catalyst for price appreciation.

There are also growing indications of potential entry by sovereign wealth funds. Ethereum, in turn, could gain additional support from:

  • development of L2 infrastructure,

  • potential staking-based ETFs,

  • increasing demand for institutional-grade Web3 assets.

The success of major funds is already encouraging asset managers to launch new altcoin ETFs. The most recent example is the explosive performance of the XRP ETF. According to Bitwise CIO Matt Hougan, 2026 could bring a true “ETF explosion”, with more than 100 crypto ETFs currently in development.