Bitcoin’s recent surge to $93,000 is being driven by institutional investors, not retail exchange-traded fund (ETF) buyers, according to John D’Agostino of Coinbase Institutional in a CNBC interview.
The rally, which started in early April, was primarily fueled by deep-pocketed institutions and sovereign wealth funds quietly accumulating Bitcoin with their “patient pools of capital,” while retail investors continued to pull funds from spot ETFs. D’Agostino pointed out that institutions were taking advantage of the opportunity while retail investors were exiting, raising the question of what institutions might know that others don’t.
This trend of institutional involvement has been further formalized with the launch of Twenty One Capital, a new Bitcoin investment company backed by Tether, Bitfinex, and SoftBank. The company plans to start with more than 42,000 BTC and will trade publicly under the ticker “XXI” after merging with Cantor Equity Partners, a $200 million special purpose acquisition company (SPAC).
D’Agostino laid out a three-part thesis for this institutional push. First, there’s a move toward de-dollarization, as sovereign entities and institutions reduce their exposure to USD amidst global trade slowdowns. Second, Bitcoin is becoming decoupled from the tech sector, shedding its previous ties to tech stocks like Nvidia. Third, Bitcoin is gaining traction in inflation-hedge models, ranking among the top five assets used by seasoned commodities traders.
“Bitcoin is trading based on its core characteristics, which are similar to gold: scarcity, immutability, and non-sovereign asset portability,” D’Agostino explained. “It’s trading the way believers in Bitcoin want it to trade.”
In contrast, major altcoins such as Ether (ETH), Solana (SOL), and Cardano (ADA) have not yet shown similar technical strength. The CoinDesk 20, which tracks the performance of the largest digital assets, is down 3% over the past month, while Bitcoin has risen 7%.
This price movement has revived some retail interest in Bitcoin ETFs. Data from SoSoValue showed that ETF inflows surpassed $900 million for the second consecutive day on Wednesday, bringing the total ETF inflows between April 21 and 23 to over $2.2 billion. However, there were still 9 days this month where Bitcoin ETFs experienced net outflows, totaling approximately $1.21 billion.
