Institutional Appetite for Digital Assets Surges as $2.6B Flows Into Bitcoin and Ethereum Treasuries

Digital asset treasuries absorbed more than $2.6 billion in institutional capital over the two weeks following the Federal Reserve’s December rate cut, marking the strongest inflow period in seven weeks amid broader cryptocurrency market volatility.

The surge in institutional demand comes as Bitcoin trades at $87,858.00, up 1.08% in the past 24 hours but down 2.54% over the past week, while maintaining its dominant 59.49% share of the total cryptocurrency market capitalization of $2.95 trillion. The sustained institutional interest demonstrates a marked shift in how traditional finance approaches digital assets during periods of macroeconomic uncertainty.

CoinShares reported that digital asset exchange-traded products saw $716 million in weekly inflows as of December 8, lifting total assets under management to approximately $180 billion with broad-based participation led by U.S. institutions. However, analytics firm Glassnode characterized recent U.S. Bitcoin ETF flows as “quiet,” with net flows below zero on a short-term average, reinforcing the notion that institutions remain engaged but cautious and price-sensitive.

The December rate cut triggered a classic “buy the rumor, sell the news” pattern across crypto markets, with Bitcoin initially climbing above $94,000 before retreating below $90,000 immediately following the Federal Reserve’s announcement. Despite the short-term volatility, the sustained two-week inflow period suggests institutional investors are viewing current price levels as attractive entry points for long-term positioning.

Standard Chartered revised its Bitcoin forecasts this week, with the bank now projecting Bitcoin around $100,000 by end-2025 and $150,000 by end-2026, down from prior more aggressive targets. The adjustment reflects what analysts describe as a shift toward ETFs as a more important future driver than corporate “bitcoin treasury” buyers, highlighting the maturing institutional infrastructure around digital assets.

Corporate treasury adoption continues to evolve despite market volatility. American Bitcoin Corp recently increased its holdings by 261 Bitcoin, bringing its total to 5,044 BTC, while MicroStrategy spent $980.3 million last week to purchase 10,645 bitcoins. These acquisitions demonstrate corporate resilience even as Bitcoin treasury companies have suffered more than the underlying asset, with Bitcoin having tumbled as much as 36% from its record high.

The institutional landscape is becoming increasingly sophisticated, with activist investor Eric Jackson’s EMJ Crypto Technologies developing the first actively hedged digital-asset treasury holding Bitcoin, Ethereum and selective altcoins. This approach generates yield by selling options rather than repeatedly issuing equity or debt, representing a new paradigm in corporate digital asset strategies.

Market structure improvements continue to support institutional adoption. The Office of the Comptroller of the Currency is pulling more crypto activity into U.S. supervised structures through trust charters, while pending legislation including the market structure bill could provide greater regulatory clarity and potentially trigger additional institutional capital inflows.

Looking ahead, Glassnode analysis suggests sell-side pressure from long-term holders appears closer to saturation, with around 20% of Bitcoin supply reactivated over the past two years. The expectation is for original holder selling to subside in 2026, allowing Bitcoin to transition toward net buy-side demand amid deeper institutional integration, potentially supporting sustained treasury inflows as corporate adoption matures.