Cryptocurrency surge propels optimistic start and Bitcoin reaching a fresh record high
In the ever-evolving world of cryptocurrencies, institutional investment has taken centre stage, propelling the market forward with a focus on Bitcoin and Ethereum, among other digital assets.
Bitcoin's momentum is getting a lift from excitement around its upcoming halving, with the digital currency up around 33% so far this year and having gained nearly 120% over the past 12 months, reaching an all-time high of $124,000 on Wednesday.
Meanwhile, Ethereum has been on a strong run, climbing about 87% in the past three months and approaching its own record high. The strategic shift among institutions is evident, with hedge funds reducing exposure due to volatility, while long-term risk-managed allocations by advisors are growing.
The institutional investment in cryptocurrency reached $21.6 billion in Q1 2025, indicating robust inflows. About 59% of institutional investors plan to allocate over 5% of assets under management (AUM) to crypto, with 60% currently allocating more than 1%, though allocations above 20% remain rare.
Institutional Bitcoin ETF ownership is substantial, with registered investment advisors and wealth managers holding about 50% of Bitcoin ETF assets. However, institutional share in spot Bitcoin ETFs remains below 10%, as retail investors still dominate those flows.
Ethereum, on the other hand, is outpacing Bitcoin in institutional inflows in 2025, driven by staking yields, deflationary tokenomics, and enhanced scalability from upgrades like Ethereum 2.0 and Dencun. Ethereum ETFs attracted $9.4 billion in inflows by July 2025, compared to Bitcoin ETF inflows of only $548 million during the same period.
The growing interest in Ethereum can be attributed to its role as both a DeFi infrastructure with a $223 billion total value locked (TVL) and a yield-generating asset. Institutions are increasingly focusing on utility rather than Bitcoin's pure store-of-value narrative.
Venture capital investment in crypto infrastructure, custody, and compliance solutions rose sharply in 2025, reflecting institutional demand for security and regulatory compliance. Institutional strategies are focusing on more mature, regulated products such as Layer 1 blockchains, AI tokens, DeFi blue chips, and stable yield strategies.
Regulatory advancements and improved infrastructure are key drivers enabling this trend. The approval of Bitcoin ETFs and stablecoin frameworks is enhancing institutional comfort with crypto investments.
Bullish, a digital asset exchange focused on institutional traders, made a striking market debut on Wednesday, surging over 90% after its IPO. The IPO was priced at $37 per share and raised $1.1 billion, giving the company an initial valuation of about $5.4 billion. By Thursday morning's pre-market session, Bullish stock was trading around $77.
Bullish owns CoinDesk, a leading name in crypto journalism, and is uniquely positioned at the center of the crypto market due to its compliant, institutional-focused market infrastructure. The company believes that the digital assets industry is beginning its next leg of growth.
Heavyweight investors such as BlackRock and Cathie Wood's Ark Invest signaled plans to buy up to $200 million worth of shares in Bullish, further underscoring the growing institutional interest in the crypto market.
As institutional investment in cryptocurrency continues to grow with a diversified portfolio approach, Bitcoin retains a strong presence, especially through ETFs held by wealth managers. However, Ethereum and yield-producing crypto assets increasingly dominate institutional allocations.
[1] Grinberg, J. (2025). Institutional Investors Are Piling into Crypto—and Bitcoin ETFs Are a Big Part of the Story. Barron's. [2] Liu, J. (2025). Institutional Investors Are Flocking to Crypto—Here's What They're Buying. Fortune. [3] Smith, A. (2025). Ethereum Is Outpacing Bitcoin in Institutional Investment—Here's Why. CoinDesk. [4] Johnson, K. (2025). Venture Capital Investment in Crypto Infrastructure Booms—What It Means for Institutional Investors. The Block.
- Institutional investors are increasingly focusing on utility in their cryptocurrency investments, with Ethereum's yield-generating characteristics and enhanced scalability attracting substantial allocations, surpassing Bitcoin in institutional inflows in 2025. (CoinDesk, 2025)
- The growing institutional interest in the crypto market is evident through the significant investments in crypto infrastructure, custody, and compliance solutions, as well as the increasing ownership of Bitcoin and Ethereum ETFs by registered investment advisors and wealth managers. (Barron's, 2025 & The Block, 2025)
