The rise of ETFs challenges Bitcoin’s self-custody roots

Key Points

1. Bitcoin ETFs and institutional products are reshaping investor behavior, moving away from self-custody to regulated, institutional-held assets.

2. Spot Bitcoin ETFs, like those from BlackRock and Fidelity, saw $50 billion in net inflows within 18 months, with BlackRock's IBIT reaching $83 billion in assets under management by July 2025.

3. The number of public companies holding Bitcoin surged 58% in Q2 2025, with over 250 organizations now holding BTC on their balance sheets.

4. ETFs offer convenience, tax advantages, and secure custody, attracting investors who prefer traditional brokerage platforms over managing private keys.

5. The shift to ETFs has led to a decline in active Bitcoin addresses, dropping from nearly 1 million in January 2024 to around 650,000 by late June 2024.