Institutions Ride Out Crypto Storm, Increase Exposure Amid 50% Drawdown
Bitwise's first Institutional Crypto Adoption Report highlights the resilience of institutional investors during a major drawdown in the crypto market. Between October and April, Bitcoin (BTC) experienced a roughly 50% decline, but none of the 15 surveyed institutions cut their crypto allocations.
In fact, several organizations increased their exposure to cryptocurrencies during this period. Every institution that owned crypto held BTC as its core holding, often as its largest and longest-standing position. Ethereum (ETH) and Solana (SOL) were also present in smaller allocations tied to clearer conditions for when they should be maintained.
When asked about the potential reasons for selling their crypto holdings, institutions pointed to fundamental and credibility risks rather than price declines. They highlighted regulatory reversals, an industry-wide credibility problem, or a clear failure of their investment thesis as potential triggers for selling.
The report suggests that institutional investors view crypto exposure as a long-term mandate rather than a trading position. This approach is reflected in the fact that most allocations were structured via spot crypto ETFs, which can reduce operational complexity and align with established portfolio management workflows.