Key Takeaways

  • Institutional investors plan to increase their exposure to cryptocurrencies.
  • Majority of institutions expect higher future returns from their crypto investments.
  • Altcoin ETFs could be the next catalyst for institutional inflows.
  • Regulatory delays are hindering ETF approvals.

Institutional Investors Bullish on Crypto

Despite a sharp market correction in October, institutional investors are maintaining confidence in digital assets, with most planning to expand their exposure in the months ahead, according to new research. Over 61% of institutions plan to increase their cryptocurrency investments, while 55% hold a bullish short-term outlook, Swiss crypto banking group Sygnum said in a report released on Tuesday. The survey covered 1,000 institutional investors globally.

Expectations of Higher Future Returns

Roughly 73% of surveyed institutions are investing in crypto due to expectations of higher future returns, despite the industry still recovering from the record $20 billion market drawdown at the beginning of October. However, investor sentiment continues facing uncertainty due to delays in key market catalysts, including the Market Structure bill and the approval of more altcoin exchange-traded funds (ETFs).

Maturing Digital Asset Market Predicted

While this uncertainty may persist into 2026, Sygnum’s lead crypto asset ecosystem researcher, Lucas Schweiger, predicts a maturing digital asset market, where institutions seek diversified exposure with long-term growth expectations. “The story of 2025 is one of measured risk, pending regulatory decisions, and powerful demand catalysts against a backdrop of fiscal and geopolitical pressures,” he said.

Institutional Demand Remains High

Despite October’s correction, “powerful demand catalysts” and institutional participation remained at an all-time high, with the growing ETF applications signaling more institutional demand, added Schweiger. At least 16 crypto ETF applications are currently awaiting approval, delayed by the ongoing US government shutdown, now in its 40th day.

Crypto Staking ETFs as a Potential Catalyst

Crypto staking ETFs may present the next fundamental catalyst for institutional cryptocurrency demand. Over 80% of the surveyed institutions expressed interest in crypto ETFs beyond Bitcoin (BTC) and Ether (ETH), while 70% stated that they would start investing or increase their investments if these ETFs offered staking rewards.

Anticipating Altcoin ETF Approvals

Meanwhile, investors are now anticipating the end of the government shutdown, which could bring “bulk approvals” for altcoin ETFs from the US Securities and Exchange Commission, catalyzing the “next wave of institutional flows,” according to Sygnum.

Risk Warning: This article is provided for informational purposes only and does not constitute investment advice, investment research, or a recommendation to trade. The views expressed are those of the author and do not necessarily reflect the position of Markets.com. When considering shares, indices, forex (foreign exchange), and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and may not be suitable for all investors. Leveraged products can result in capital loss. Past performance is not indicative of future results. Before trading, ensure you fully understand the risks involved and consider your investment objectives and level of experience. Cryptocurrency CFD trading restrictions may apply depending on jurisdiction.

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