Who exactly has been persistently pouring money into the bear market of crypto?

Original by Odaily (@OdailyChina)

Author: jk

Introduction: Who is Planting the Seeds for the Next Bull Run?

The crypto bull market from 2024 to 2025 was, at its core, an institutional story. What drove Bitcoin past $100,000 back then was not retail FOMO, but the net inflows from BlackRock's IBIT ETF post-launch and Strategy's continuous bond financing to purchase BTC. The underlying logic of that bull run was inseparable from the positions institutions quietly accumulated during the 2022-2023 bear market.

Now, history seems to be repeating, but with starkly different details. In the first quarter of 2026, Bitcoin retreated over 25% from its highs, Ethereum fell even deeper, and market sentiment cooled once again. Yet against this backdrop, the directional moves of a cohort of institutions ran counter to the price trend: corporate treasuries are adding, sovereign wealth funds are adding, bank-linked ETFs are listing, and traditional European financial institutions are entering the stablecoin space. All of this points to the same question: If the next major rally is still to be driven by institutional capital, who exactly is buying during this bear market accumulation phase?

Odaily reporters conducted an in-depth investigation into institutional capital inflows into the crypto market during Q1.

Here's the bottom line: Even as the market experienced a brutal correction in the first quarter, institutional capital continued to flow steadily into the crypto market. Bitcoin fell over 25% from around $88,000 to the mid-$60,000 range, Ethereum dropped a steeper 35%, yet Strategy (formerly MicroStrategy) bucked the trend and added over $10 billion worth of Bitcoin. Sovereign wealth funds like Mubadala also increased holdings during the dip. Simultaneously, approximately 26 single-asset crypto ETFs were launched or had applications submitted under the SEC's new general listing framework.

Capital entering in Q1 2026 showed distinct bifurcation: some hedge funds made significant reductions (Brevan Howard cut its IBIT holdings by 85%), while corporate treasuries, university endowments, ETF issuers, and Abu Dhabi's sovereign wealth fund took the opportunity to buy the dip. In venture capital, despite a 49% plunge in the number of deals, the total quarterly fundraising volume remained robust at approximately $5.0 to $6.8 billion, with three deals (BVNK, Kalshi, Polymarket) accounting for half of that sum. Externally, the SEC's new rules in September 2025 compressed the ETF approval cycle from 240 days to 75 days; and on March 17, 2026, a joint SEC and CFTC statement deemed staking rewards as non-securities, triggering a wave of staking ETF issuances.

Part I: Active Institutional Buyers and Capital Deployment

Newly Issued Crypto ETFs (Jan-Apr 2026)

This quarter saw a dense concentration of new crypto ETF product launches. Bitwise launched the Chainlink ETF (CLNK) on the NYSE Arca on January 14, with $2.5 million in seed funding. Canary Capital launched two products simultaneously on January 13: the Litecoin Spot ETF (LTCC, cumulative AUM of approximately $9.7 million, the first spot LTC product in the US) and the HBAR ETF (the first US spot Hedera product). The company then launched a staked Sui ETF with staking rewards in February. Grayscale also launched a Sui staking ETF in February. 21Shares launched the Sui ETF (TSUI, AUM approximately $12.5 million) on Nasdaq on February 24 and the Polkadot ETF (TDOT, 0.30% fee, the first US spot DOT product, with a first-week AUM of about $11 million) on March 6.

Established financial players also launched ETFs. BlackRock launched the iShares Ethereum Staking Trust (ETHB) on March 12, the first ETH staking ETF from a major institution, distributing approximately 82% of staking yields directly to holders. Morgan Stanley launched the Morgan Stanley Bitcoin Trust (MSBT) on April 8, the first bank-issued spot BTC ETF in the US (0.14% fee), attracting $34 million on its first day and reaching a cumulative size of $133 million after eight days. Additionally, ProShares launched the CoinDesk 20 Crypto Index ETF (KRYP) on the NYSE Arca in Jan-Feb; NEOS launched the Enhanced Bitcoin High Interest ETF (XBCI) around January 29; Bitwise launched the Proficio Currency Devaluation ETF (BPRO, combining BTC and precious metals); Nomura/Laser Digital launched the Bitcoin Diversified Yield Fund (BDYF, a tokenized yield product) on January 22; 21Shares launched the Strategy Yield ETP (STRC), backed by BTC, on the SIX Swiss Exchange on February 25; and Hashdex expanded its NCIQ Q1 to include BTC, ETH, XRP, SOL, and XLM.

Overall, New Money, meaning ETFs for smaller market cap coins, are being launched. However, ETFs from more established financial players remain concentrated on high-market-cap, blue-chip coins.

Noteworthy ETF Applications (Still Pending as of April 23)

Morgan Stanley filed S-1 applications in early January for a spot BTC trust (MSBT, already listed in April), as well as Solana and ETH trusts. Goldman Sachs filed for a Bitcoin Premium Income/Option Strategy ETF on April 14. Hyperliquid (HYPE) attracted applications from four competing institutions: Grayscale (GHYP, March 20), Bitwise (BHYP, April 10), 21Shares (THYP, April 14), and VanEck (VHYP); none are approved for listing yet. Grayscale, VanEck, 21Shares, Bitwise, and Canary have all submitted applications for an ADA spot ETF; CME's ADA futures contract went live on February 9. Truth Social (Yorkville) submitted applications for a BTC+ETH combo ETF and a Cronos Yield Enhancement ETF on February 13. Bitwise filed for 11 crypto strategy ETFs (covering AAVE, UNI, ZEC, TAO, etc.). REX-Osprey/Defiance filed for a massive 27 crypto ETFs, including staking products and 3x leveraged products.

Currently, the Hyperliquid ETF remains the most anticipated.

ETF Fund Flows (Q1 2026)

Spot BTC ETF flows were volatile: January saw net outflows of about $1.6 billion (Crypto.com data showed it was the third consecutive monthly net outflow), but with buying returning in March-April, the full quarter ultimately narrowed to a net positive. BlackRock's IBIT remained the flagship product, attracting net inflows of approximately $8.4 billion in Q1, though its AUM shrank from around $78 billion to $54 billion due to the price decline. Ethereum ETFs set a record of 19 consecutive days of positive inflows in early January. XRP ETFs saw net inflows of $1.07 billion for the quarter, with a 43-day streak of positive inflows, significantly outperforming BTC products in the same period. Solana ETFs (BSOL, FSOL) saw their combined AUM exceed $1 billion in April; Goldman Sachs disclosed holding $108 million in SOL ETF positions.

Net inflows positive for the full quarter

Public Company Bitcoin Treasury Purchases

Strategy (MSTR) continued its aggressive accumulation this quarter. As of April 20, 2026, Strategy held a total of 815,061 BTC at an average price of $75,527, representing a cost basis of approximately $61.6 billion. Japanese listed company Metaplanet (3350.T) disclosed on January 1, 2026, that it had purchased 4,279 BTC at an average price of $104,638, totaling over $380 million; for the entire first quarter, it added 5,075 BTC, and upon disclosure on April 2, it held a cumulative total of 40,177 BTC, with a Q1 acquisition cost of about $400 million.

Strive (ASST) purchased 123 BTC at an average price of $91,561 on January 13, totaling $11.3 million; it subsequently completed an all-stock merger with Semler Scientific, resulting in a combined holding of 12,798 BTC, making it the 11th largest corporate treasury. The merger was completed on January 16. By mid-March, Strive held approximately 13,628 BTC through its PIPE and the Semler merger. DDC Enterprise (NYSEAM) added about 600 BTC in January alone, accumulating 2,383 BTC by March 19, valued at $182 million total.

BSTR Holdings (led by Adam Back, Cantor SPAC) announced plans to go public holding 30,021 BTC (valued at $2.14 billion). Twenty One Capital (XXI) held 43,514 BTC (worth over $3.1 billion) as of April 2, making it the second-largest corporate Bitcoin holder among listed companies. Hyperscale Data (GPUS) held 663 BTC as of April 21, entered at a cost of $50.3 million, with a target treasury size of $100 million.

Ethereum and Staking-Related Corporate Treasuries

BitMine Immersion (BMNR) is currently the largest corporate Ethereum treasury. In Q1, it staked 74,880 ETH (approximately $219 million) via the MAVAN platform; during the week of April 20, 2026, it purchased a record single-week amount for 2026 of 101,627 ETH (over $230 million). As of April 20, the company held a total of approximately 5 million ETH, of which roughly 3.33 million were staked, with an AUM of about $12.9 billion. SharpLink Gaming (SBET) is the second-largest Ethereum treasury, holding approximately 867,000 ETH (valued between $1.7 billion and $2.3 billion), nearly 100% staked, disclosed on March 10.

Major Sellers

Bitcoin miners were net sellers overall in Q1. MARA Holdings sold 15,133 BTC from March 4 to 25, raising $1.1 billion for convertible note repurchases; Riot Platforms sold 3,778 BTC, raising $290 million; Nakamoto Holdings sold 284 BTC; Genius Group liquidated its entire holding of 84 BTC on April 1. The Kingdom of Bhutan (Druk Holdings) transferred small amounts of BTC totaling approximately $42 million during the year. Strategy alone accounted for 94% of all net Bitcoin purchases by public companies in March.

Actions by Banks and Asset Managers

Beyond filing for ETFs, Morgan Stanley applied for a Digital Trust Bank National Charter with the OCC in February 2026 and announced it would offer BTC/ETH/SOL trading to retail clients through E*Trade/Zerohash.

UBS announced on January 23 that it would offer BTC/ETH trading services to its Swiss private banking clients, covering its $7 trillion wealth management business.

Citigroup announced the launch of institutional-grade BTC custody infrastructure at the Strategy World conference on February 26. Standard Chartered launched institutional BTC/ETH custody services in Hong Kong in January and was reported to be in talks to acquire full equity in its subsidiary Zodia Custody (April 8).

BBVA recommended high-net-worth clients allocate 3-7% to crypto assets.

A consortium of 12 European banks (BBVA, BNP Paribas, ING, UniCredit, KBC Bank, Danske Bank, Svenska Handelsbanken, CaixaBank, DZ Bank, DekaBank, Raiffeisen Bank, Banca Sella) formed the Qivalis euro stablecoin consortium based on the Fireblocks platform, compliant with the MiCA regulatory framework (April 21).

Vanguard opened up third-party crypto ETFs to its 50 million brokerage clients on its $11 trillion platform. Fidelity offered a 1% BTC allocation option within its 401(k) retirement plans, reportedly attracting approximately $800 million.

Nomura, Daiwa Securities, and SMBC Nikko Securities all announced plans to launch cryptocurrency exchanges in Japan by the end of 2026.

13F Filings (Q4 2025 Holdings, Filed in February 2026)

Goldman Sachs' total crypto ETF holdings were approximately $2.36 billion, covering BTC ($1.06 billion), ETH ($1.0 billion), XRP ($152 million), and SOL ($109 million). However, its BTC and ETH positions were reduced by 39% and 27% quarter-over-quarter, respectively.

Mubadala (Abu Dhabi sovereign wealth fund) increased its IBIT holdings by 46% to 12.7 million shares (approximately $631 million), adding an estimated 2,300 BTC counter-cyclically during the market downturn.

Al Warda Investments (part of ADIA) increased its IBIT holdings to 8.2 million shares (approx. $437 million), pushing the total Abu Dhabi sovereign crypto exposure past the $1 billion mark.

Millennium increased its IBIT holdings by approximately 67% (adding an estimated 8,100 BTC, becoming the largest overall holder).

Jane Street increased its IBIT holdings by over 50% to 20 million shares.

Harvard University reduced its IBIT holdings by 21.5% but established its first ETH position (3.87 million shares of ETHA, worth $86.8 million). Dartmouth College became the fourth Ivy League school to enter the space.

On the selling side: Brevan Howard drastically cut its IBIT holdings by 85% (from 37.5 million to 5.5 million shares, equivalent to reducing its position by roughly 17,700 BTC); Farallon cut 70% (approx. 2,800 BTC); Tudor reduced its position by about 1,300 BTC; D.E. Shaw halved its IBIT holdings; and Sculptor almost completely exited its FBTC position (cutting about 90%).

Sovereign Wealth Funds and National Governments

Besides Mubadala and Al Warda, the Luxembourg sovereign wealth fund FSIL maintained a 1% Bitcoin allocation (about €8.5 million), becoming the first Eurozone sovereign wealth fund to hold BTC. El Salvador continued its "buy 1 BTC daily" strategy (now holding 7,547 BTC, worth approximately $635 million) and added $50 million to its gold reserves on January 29. Czech National Bank (purchased in November 2025, continuing into 2026) remains the only central bank globally to hold Bitcoin.

The US Strategic Bitcoin Reserve has made zero purchases to date. CoinDesk confirmed on March 6 that the Trump executive order had "slow progress"; the reserve still only holds approximately 328,372 seized BTC. White House Digital Assets Council member Patrick Witt reiterated the commitment, but no actual purchases have occurred. Among US states, only Texas injected $5 million into IBIT in November 2025 (with an additional $5 million not yet deployed). New Hampshire and Arizona have passed relevant legislation but have not deployed funds. Persistent reports about CalPERS intending to allocate 1% (approx. $500 million) to BTC remain unconfirmed by CalPERS officials.

Family Offices

Two surveys reveal contrasting trends: J.P. Morgan Private Bank's 2026 Family Office Report found that among 333 surveyed firms (average net worth of $1.6 billion), 89% had zero Bitcoin allocation, with AI investment being the top priority. Conversely, the BNY Wealth/NOIA survey showed that 74% of ultra-high-net-worth family offices are investing in or exploring crypto assets (up significantly from 53% the previous year), with typical allocation ratios of 2-5%, Asian firms at about 5%, and US and European firms at about 2-4%.

Part II: Q1 2026 Crypto Venture Capital Funding Summary

Q1 2026 crypto VC funding presented a paradox: total capital was relatively stable (down 8% to 16% year-over-year), but the number of deals plummeted by 49%. The most comprehensive statistics come from