Institutions are moving to Bitcoin: risks and opportunities ahead

Institutional Capital Flocks to Bitcoin, Ethereum Under Pressure: Risks and Opportunities

5 November 2025 at 12: 26

Reading time: 2 minutes

With the continued inflow of institutional capital into Bitcoin, the focus on Ethereum is increasingly under pressure. Companies focused on Ethereum are quickly running out of liquidity, which could transform the cryptocurrency into an attractive shorting scenario for investors looking to hedge their exposure to the digital asset. These are some key insights from a recent report from 10x Research, which argues that shorting Ether (ETH) could be a smart strategy to counter Bitcoin (BTC).

Bitcoin remains the primary attraction for institutional investors, while Ether appears to be struggling with structural weaknesses. Analysts point out that the "digital asset treasury" narrative surrounding Ethereum led to an accumulation of ETH by institutions, which later distributed it to retail investors. This dynamic is now showing cracks, partly due to a lack of transparency in reporting around private investments in public equity (PIPE) and uncertain capital flows.

The report cites the treasury firm BitMine as a prime example. Their strategy allowed institutional investors to accumulate ETH at par value, then sell it at a premium to retail buyers—a feedback loop that continued to drive prices higher.

In addition, several technical indicators were presented suggesting that the price of Ether could fall rapidly if the support around $3.000 fails. In that case, the price could drop to around $2.700.

The researchers noted that Ether's weekly stochastic indicators are showing signs of a peak level. They pointed to a multi-year wedge formation revealing a false breakout, reminiscent of the false breakout that occurred in March 2025.

ETH Treasury firms remain optimistic despite market risks

Currently, there are 15 companies focused on digital asset treasury with Ethereum, together holding 4,7 million ETH, according to industry data. BitMine is by far the largest player, with approximately 3,3 million ETH on its balance sheet. SharpLink follows with approximately 859.853 ETH and Bit Digital with 150.244 ETH.

Despite recent volatility in the Ether market, including declining demand from US spot exchange-traded funds (ETFs), Tom Lee, chairman of BitMine, has maintained his optimistic outlook. In earlier remarks, Lee said he believes the Ether price can reach $10.000 this year and that the asset has built a solid foundation since 2021.

However, the overall market mood has shifted, with a sense of caution following the October 10 crash, which wiped out approximately $19 billion in crypto holdings—the largest liquidation in history. Since then, Ether, like the broader digital asset sector, has struggled to regain momentum.

Frequently Asked Questions

What are the main risks of shorting Ether?
Shorting Ether can be lucrative, but also risky, especially given the possibility of unexpected price increases due to bullish sentiment or positive development updates. Investors who short Ether should also consider the cost of borrowing the asset.

Why does Bitcoin have more institutional interest than Ethereum?
Bitcoin is often seen as the "gold standard" of crypto, with greater liquidity and fewer structural risks compared to Ethereum. Institutional investors are most interested in BTC for its proven track record and potential as an inflation hedge.

How can technical indicators help in making investment decisions in the crypto market?
Technical indicators, such as stochastic oscillators, can provide insights into market cycles and potential price movements. They help investors identify trends and anticipate potential turning points in the price movements of digital assets.

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