Market analysts suggest that institutional investors might focus on altcoins as a new wave of cryptocurrency exchange-traded funds (ETFs) emerges in the United States.
In the first half of October, the US Securities and Exchange Commission (SEC) received at least five new altcoin ETF applications, despite delays caused by the ongoing government shutdown.
Leon Waidmann, head of research at Web3 analytics firm Onchain, stated that each approval could “open the door for the next wave of institutional buying.”
“With Bitcoin and Ethereum ETFs proving institutional demand, altcoin ETF inflows are the inevitable next step,” Waidmann told Cointelegraph. “This indicates regulatory confidence translating into capital flows.”
Ether ETFs outpace Bitcoin ETF inflows in Q3
During the third quarter of 2025, spot Ether (ETH) ETFs attracted $9.6 billion in inflows, surpassing the $8.7 billion from spot Bitcoin (BTC) ETF inflows, according to data aggregator SosoValue.
This trend indicates a growing institutional interest in alternative crypto exposure.
Waidmann added that altcoin ETFs may spark the next wave of institutional altcoin adoption through regulated vehicles, leading to years of steady inflows.
“Institutions discovered Bitcoin via ETFs, and now they’re transitioning to Ethereum, with other altcoins to follow.”
On Nansen’s blockchain intelligence platform, the top traders designated as “smart money” are also preparing for the potential approval of altcoin ETFs.
As of Thursday, the three most held tokens by smart money traders were Uniswap (UNI), Aave (AAVE), and Chainlink (LINK), according to data from Nansen.
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Nonetheless, some analysts worry that the lack of BlackRock in the altcoin ETFs could lead to limited inflows since BlackRock’s Bitcoin ETF has secured $28.1 billion in investments this year, making it the only fund with positive year-to-date (YTD) inflows.
Without BlackRock’s fund, spot Bitcoin ETFs have seen a cumulative net outflow of $1.27 billion year-to-date, according to K33’s head of research, Vetle Lunde.
Related: Arthur Hayes calls for $1M Bitcoin as new Japan PM orders economic stimulus
Based on trends observed in Bitcoin ETF investments, the absence of BlackRock from the altcoin ETF wave might restrict cumulative inflows and the potential positive impact on the underlying tokens, the researcher noted.
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