Bitcoin price has risen by more than 120% in just a few months. It is the biggest price increase since the parabolic rise of the bull market in 2021. The same applies to Ethereum (ETH), which has already risen by more than 110% since October. Which of the two coins will perform best in the near future remains unclear, but according to a study, Ethereum is making up an increasingly larger share of institutions’ portfolios.
Ethereum is becoming increasingly popular among institutions
The research department of the crypto exchange Bybit powered by SATOS writes in a research report that institutions are interested in both crypto coins, but are increasingly focusing primarily on Ethereum. As of January 31, 2024, Bitcoin represented an average of 39.49% of their portfolio, while Ether represented 39.82%.
Although this is a tiny difference, it is clearly visible when measuring the difference over the past few months. Last summer, the hype around US spot ETF applications increased, with capital allocation to Bitcoin increasing from 30% to around 50% in November. Since then, Bitcoin’s share of institutions’ portfolios has fallen in favor of Ethereum. His share has roughly doubled.
The main reason for this is said to be Ethereum’s Dencun network upgrade, which is intended to significantly reduce transaction costs and is expected to take place in March. The hope that Ethereum spot ETFs will be approved in the USA is also likely to play a role.
Institutions that are not interested in memecoins
Private investors are now showing particular interest in altcoins other than Bitcoin and Ethereum. These categories account for 28.81% and 36.61% of investor portfolios, respectively. Institutions hardly dare to burn their fingers on these categories – they only put 5.16% and 15.54% of their money into them, respectively.
It is also noticeable that institutions have withdrawn almost all of their money from the categories of memecoins, exchange tokens and AI tokens. All in all, they seem to be quite risk-averse in their approach. Private investors, on the other hand, have a fairly diverse portfolio in which all categories are actually represented. BRC-20 tokens also make up more than 10% of their portfolio, as do decentralized finance (DeFi) and Layer 1 altcoins.
