Institutional Interest May Shift From Layer 2 Tokens to BTC and ETH Amid Market Momentum Changes

Key Points

1. Layer 2 tokens (e.g., ARB, OP, ZK) and restaking tokens (e.g., LDO, ETHFI) are underperforming due to weak price momentum and limited institutional interest.

2. BTC, ETH, SOL, DOGE, and PEPE are favored for their liquidity and growth potential, with institutional investors taking leveraged positions in these assets.

3. Meme coins like DOGE and PEPE are gaining institutional attention due to better liquidity and market strength.

4. The shift reflects a broader preference for assets with proven market strength and institutional backing over Layer 2 and restaking projects.

5. Institutional capital is being redirected toward primary Layer 1 tokens and meme-driven altcoins, highlighting evolving investment trends in the crypto market.