Table of Contents
None of the 15 large institutions interviewed by Bitwise reduced its crypto allocation during the roughly 50% market drawdown between the fourth quarter of 2025 and the second quarter of 2026, and several added to their positions, according to the asset manager's first Institutional Crypto Adoption Report.
The report, written by chief investment officer Matt Hougan and head of research Ryan Rasmussen, draws on interviews conducted in March and April with endowments, foundations, public pensions, sovereign wealth funds, multi-family offices, investment consultants and public companies managing anywhere from hundreds of millions to tens of billions of dollars.
Every institution that holds crypto holds bitcoin, and for nearly all of them it was the first, largest and longest-held position. Allocators that weight their holdings by market capitalisation keep roughly 80% of their crypto exposure in bitcoin. Most now frame the asset alongside gold as a store of value. "People are starting to use bitcoin as a fiat debasement trade along with gold," one large endowment told Bitwise, and one sovereign wealth fund said it was funding its crypto allocation by selling foreign exchange and gold reserves.
Ether and Solana are held in smaller positions with shorter time horizons and explicit exit conditions. One institution with DeFi experience said it saw no "clear mechanism by which value accrues to the underlying token," and several said they would exit within a few years if adoption fails to show up in prices. "Something has to work. At some point, if this stuff doesn't work, we'll be out," said one investor who has held crypto for a decade.
Allocations ranged from 0.5% to 13% of investable assets, with most between 1% and 2%. Family offices reported the largest positions and sovereign wealth funds the smallest, and the full report finds allocation size falls as the number of approvals required rises. Almost every institution either uses spot ETFs or plans to, and several are moving out of illiquid private placements into ETF or direct exposure. No investor named price as a reason to sell; the stated triggers were thesis failure, regulatory reversal or an industry-wide credibility crisis.
Bitwise argues the obstacles are now institutional. Custody logistics, board approval and the difficulty of classifying assets like ether within existing frameworks weigh more heavily than doubts about returns, and at public-facing funds career risk still dominates. "If your peers own crypto and you don't, you are structurally short relative to what you're being graded on," one investment consultant said. The report also flags a concentration risk, with only about 10 crypto managers meeting typical institutional thresholds for size and track record.
The findings come with caveats. Fifteen interviews is a small sample, and Bitwise, which sells crypto ETFs and index funds to the same allocators, has a commercial interest in the conclusion. The firm nonetheless expects a majority of institutional investors to hold crypto within five years, while naming a major crypto-specific crisis, or ether and Solana failing to convert usage into price, as the developments most likely to slow that trajectory.
