Coinbase Report Highlights Institutional Shift from Bitcoin to Ethereum and Solana Amid ETF Momentum

Institutional investors are increasingly pivoting from Bitcoin to Ethereum and Solana as ETF-driven momentum reshapes the cryptocurrency market dynamics. According to a recent Coinbase report, while Bitcoin maintains its dominant 63% market cap share, Ethereum and Solana are emerging as undervalued alternatives with strong narrative potential and liquidity. The report suggests that fundamental factors may be temporarily overshadowed by these structural shifts, particularly as Ethereum ETFs draw significant attention. This trend underscores the evolving preferences of institutional players seeking diversified exposure in the crypto space beyond Bitcoin.

Institutional Demand Shifts from Bitcoin to Ethereum and Solana Amid ETF Momentum

Institutional investors are pivoting from Bitcoin to ethereum and Solana as ETF-driven momentum reshapes market dynamics. Bitcoin's 63% market cap dominance remains intact, but ETH and SOL are emerging as undervalued alternatives with strong narrative potential and liquidity. Coinbase's latest report suggests fundamentals may be temporarily overshadowed by these structural shifts.

Ethereum ETFs have drawn $2.27 billion in net inflows during July alone, with single-day peaks reaching $726 million. Solana, traditionally retail-dominated, is gaining institutional traction—the proposed REX-Osprey SOL Staking ETF has secured $73 million in pre-approval commitments. Regulatory observers now estimate a 99% likelihood of spot SOL ETF approval following the SEC's revised evaluation framework.

Corporate treasuries are fueling this rotation, with 14 institutions acquiring 825,000 ETH ($3 billion) and 2.95 million SOL ($531 million) as of July 18. Unlike previous speculative plays, these holdings are being staked for yield, signaling longer-term conviction. The staking trend marks a maturation in institutional crypto strategies beyond short-term trading.

Shocking Amount of ETH Lost Forever Due to User Errors: Report

At least 913,111 ETH, worth approximately $3.43 billion, has been permanently lost due to user errors, according to Coinbase Product Director Conor Grogan. The figure represents 0.76% of Ethereum's circulating supply as of January 31, 2025.

Actual losses are likely far higher when accounting for burned ETH and inaccessible wallets. Grogan notes that including the 5.3 million ETH destroyed through EIP-1559 brings the total permanent reduction to over 5% of all ETH ever created—a staggering $23.42 billion in value.

The analysis, based on verified on-chain data, reveals losses from irretrievable addresses, malfunctioning smart contracts, and wallet mismanagement. One notable incident involved 306,000 ETH lost in 2017 due to a Parity wallet bug.

Apollo and Securitize Launch $100M+ Tokenized Credit Fund (ACRED) on Blockchain

Apollo Global Management has partnered with Securitize to launch a blockchain-based tokenized feeder fund, ACRED, mirroring its established Diversified Credit Fund. The product has already attracted over $100 million since its January debut, with Coinbase Asset Management among early participants.

Investors receive digital tokens representing stakes in the fund, stored in personal crypto wallets. A unique feature allows minting sACRED tokens as collateral to borrow stablecoins on DeFi platforms, enabling Leveraged exposure to Apollo's loan book.

The $50,000-minimum fund charges a 2% management fee. This MOVE follows similar blockchain initiatives by BlackRock and Franklin Templeton, underscoring Wall Street's accelerating adoption of tokenization technology.