BlackRock says that despite the growing number of crypto-related financial products entering the market, most investor demand continues to concentrate on just two assets: Bitcoin and Ethereum.
Robert Mitchnick, head of digital assets at BlackRock, recently explained that these two cryptocurrencies remain the primary focus for investors looking for exposure through exchange-traded funds (ETFs). According to him, Bitcoin and Ethereum dominate allocation decisions for both retail investors and financial advisors.
Mitchnick noted that Bitcoin currently accounts for around 60% of the total crypto market, while Ethereum holds a much smaller but still significant share in the low-teens range. Because of this market dominance, the two assets naturally attract the largest share of institutional and retail investment flows.
Strong inflows despite Bitcoin price decline
BlackRock’s spot Bitcoin ETF, IBIT, recorded about $26 billion in inflows during 2025, even though Bitcoin’s price fell nearly 50% from the all-time high that it ended up reaching in October of the previous year.
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Despite the decline in price, the fund remained one of the most successful ETFs globally when it comes to investor inflows. In fact, IBIT ranked fourth worldwide for ETF inflows in 2025 and was the only fund among the top twenty to post positive inflows while the underlying asset delivered negative returns.
So far this year, the ETF continues to see slightly positive net inflows. Data from BlackRock suggests that almost or roughly 90% of investors have continued accumulating and building positions during the market downturn, indicating strong long-term conviction among holders.
Bitcoin as “digital gold”, Ethereum as a technology play
Mitchnick described Bitcoin mainly and primarily as a digital store of value, that is often compared to gold in the digital era. Many investors view it as a rising and emerging monetary alternative or maybe a hedge against traditional financial risks.
Ethereum, on the other hand, is often treated very differently when investors are looking to build their portfolio. Mitchnick said investors actually tend to see it as more of a technology-driven asset, which is tied to blockchain innovation and decentralized applications built on its network.
Because of this distinction, Ethereum exposure sometimes fits into portfolios similarly to venture or technology investments rather than purely monetary assets.
New ETF adds staking yield to Ethereum exposure
BlackRock recently launched a new ETF product called ETHB, which provides exposure to ether while also incorporating staking rewards.
Earlier Ethereum ETFs offered price exposure but did not include staking yield, something many investors felt was missing. By integrating staking, the new product aims to give investors a more complete way to gain exposure to the asset.
Mitchnick suggested that this feature could make ETHB significantly more attractive to investors seeking convenient exposure to Ethereum through traditional financial markets.
BlackRock’s earlier ether ETF, ETHA, already achieved rapid growth after launch. The fund became the third-fastest ETF in history to reach $10 billion in assets under management, trailing only BlackRock’s own Bitcoin ETF IBIT and Fidelity’s FBTC.
Retail investors driving ETF demand
According to BlackRock, most of the demand for crypto ETFs currently comes from retail investors and financial advisors. Both groups end up increasing their purchases as well as holdings during market pullbacks rather than reducing exposure.
Hedge funds make up a very minute and smaller share of overall flows, representing only about 10% of ETF activity. Many of these firms are not investing with a long term vision or view. Instead, they often run arbitrage strategies where they buy ETF shares while shorting Bitcoin futures. These positions are usually market neutral, but they can still lead to temporary swings in ETF flows when pricing gaps narrow.
Interest in other crypto assets remains limited
While BlackRock continues to monitor the broader digital asset market, the company says investor demand for ETFs linked to other cryptocurrencies is still relatively small.
Mitchnick said the firm does see occasional interest in a handful of other digital assets, but the majority of investor attention remains focused on Bitcoin and Ethereum.
As the market develops and new use cases appear, BlackRock will continue assessing potential ETF offerings. For now, however, the firm believes Bitcoin and Ethereum remain the main drivers of institutional participation in the crypto ETF market.
