Family offices and professional investors are showing a distinct preference for Ethereum (ETH) over Bitcoin (BTC) when it comes to allocating spot exchange-traded products (ETPs). Data from Bitwise indicates that as of Dec. 31, 2024, family offices and trusts allocate 0.62% of their assets under management (AUM) to Ethereum ETPs, significantly higher than the 0.13% allocated to Bitcoin ETPs.
This trend highlights the differing institutional forces at play in the cryptocurrency market. While Bitcoin remains the dominant player in terms of total institutional AUM, Ethereum is gaining traction among smaller, more flexible allocators like family offices.
The breakdown of the ETP market composition further underscores these differences in investor profiles and risk appetites. Hedge funds, investment advisors, and brokerages are the major players in the Bitcoin ETP space, accounting for over 85% of total allocations. In contrast, Ethereum ETP ownership is more evenly distributed among brokerages, investment advisors, and hedge funds, with a larger “Other” category making up a significant portion of Ethereum ETP AUM.
Banks, pension funds, private equity firms, venture capital, and insurance companies show varying levels of involvement in both Bitcoin and Ethereum ETPs, with family offices demonstrating a stronger preference for Ethereum despite their overall small allocation in the institutional activity.
The top institutional holders also differ between Bitcoin and Ethereum ETPs. While Millennium Management leads in Bitcoin exposure, institutions like Goldman Sachs and Jane Street are prominent holders in the Ethereum segment. Some firms are engaged in both markets, while others show a more exclusive interest in either Bitcoin or Ethereum ETPs.
Overall, Bitcoin maintains its absolute dominance in the institutional space, but Ethereum is attracting a more diverse and distributed investor base in the ETP market. This trend suggests that Ethereum is appealing to a unique group of secondary institutions, contributing to a more varied landscape in the cryptocurrency market.
In conclusion, the data reflects the evolving dynamics in the cryptocurrency market, with institutional investors showing a growing interest in Ethereum alongside the established presence of Bitcoin. This shift in allocation preferences underscores the maturation of the crypto market and the increasing recognition of Ethereum as a valuable asset in institutional portfolios.