Background Information: Bitcoin (BTC) is gradually being accepted by more investors, including publicly listed companies, sovereign wealth funds, exchange-traded funds (ETFs), and at the national level. According to a report by crypto index fund management company Bitwise, Bitcoin inflows are expected to reach 12 billion USD by the end of 2025, increasing by 30 billion USD in 2026.

Key Events: In 2024, net inflows into US spot Bitcoin ETFs reached 3.62 billion USD, with assets under management hitting 125 billion USD within 12 months, at a pace 20 times faster than gold ETFs. Despite compliance policy restrictions, risk aversion from large institutions such as Morgan Stanley and Goldman Sachs has shelved 3.5 billion USD in demand; however, as Bitcoin ETFs gain legitimacy, this capital is expected to be unlocked. The appeal of Bitcoin as a reserve asset is also growing, with publicly listed companies holding approximately 1.15 million BTC and sovereign nations holding about 529 thousand BTC.

Potential Impact: Based on different scenario forecasts, if countries shift 1% to 10% of their gold reserves to Bitcoin, inflows could range from 150 billion to 426.90 billion USD. Accelerated interest from institutions and governments demonstrates confidence in Bitcoin's long-term value. Bitcoin is viewed as a tool to combat inflation and fiat currency depreciation.

Key takeaways: Bitcoin (BTC) demand from a diverse range of investors—including publicly listed companies building Bitcoin treasuries, sovereign wealth funds, exchange-traded funds (ETFs), and nation-states—is projected to drive substantial capital inflows to the asset in the coming years. According to crypto index fund management firm Bitwise, inflows to Bitcoin could reach $120 billion by the end of 2025, with an additional $300 billion anticipated in 2026. In its recent report, “Forecasting Institutional Flows to Bitcoin in 2025/2026 ,” Bitwise highlights that US spot Bitcoin ETFs recorded $36.2 billion in net inflows in 2024, surpassing the early success of SPDR gold Shares (GLD), which revolutionized gold investing. Bitcoin ETFs reached $125 billion in assets under management (AUM) within 12 months—20 times faster than GLD—projecting Bitcoin to outperform gold significantly, with inflows potentially tripling to $100 billion annually by 2027. Despite this surge, $35 billion in Bitcoin demand remained sidelined in 2024 due to risk-averse compliance policies at major corporations like Morgan Stanley and Goldman Sachs, which manage $60 trillion in client assets. These firms require multi-year track records, but growing BTC ETF legitimacy is expected to unlock this capital. Jurrien Timmer, Director of Global Macro at Fidelity, remarked that Bitcoin trading above $100,000 signals its potential to take over gold’s role as a store of value. His analysis also pointed to the recent convergence of Bitcoin and gold’s Sharpe ratios, suggesting that both assets are becoming increasingly comparable in terms of risk-adjusted returns. Related:&nbsp;Bitcoin price ‘breather’ expected as short-term traders realize $11.6B in profit In addition to ETFs and wealth management firms, Bitcoin’s appeal as a reserve asset is rising among the public, private companies and sovereign nations. Companies with Bitcoin on the books currently hold around 1,146,128 BTC, worth $125 billion, accounting for 5.8% of BTC’s total supply. Sovereign nations collectively hold 529,705 BTC ($57.8 billion), with the United States (207,189 BTC), China (194,000 BTC), and the United Kingdom (61,000 BTC) leading the pack. Bitwise Senior investment strategist Juan Leon, UXTO research lead Guillaume Girard and research analyst Will Owens expect a continued wealth allocation to BTC, and outlined bear, base, and bull case scenarios. In the bear case, nation-states reallocated just 1% of their gold reserves to Bitcoin, driving $32.3 billion in inflows (323,000 BTC or 1.54% of supply). Multiple US states created BTC reserves at 10%, adding $6.5 billion, while wealth management platforms allocated 0.1% of assets ($60 billion). Public companies contributed another $58.9 billion, bringing the total inflows to over $150 billion. The base case envisions a 5% nation-state reallocation, generating $161.7 billion (1,617,000 BTC or 7.7% of supply). US states raised their adoption to 30% ($19.6 billion), wealth platforms allocated 0.5% ($300 billion), and public companies doubled their holdings to $117.8 billion. This scenario aligns with Bitwise’s forecast of $120 billion by 2025 and $300 billion by 2026, capturing 20.32% of Bitcoin’s supply. In the bull case, a 10% nation-state swap of gold to Bitcoin drives $323.4 billion in inflows (3,234,000 BTC or 15.38% of supply). US state adoption rises to 70% ($45.8 billion), wealth platforms allocate 1% ($600 billion), and public companies quadruple their holdings to $235.6 billion. Altogether, these inflows could exceed $426.9 billion, absorbing 4,269,000 BTC. The acceleration of institutional investor and government interest in BTC underscores growing confidence in Bitcoin’s long-term value. With 94.6% of its supply already mined (19,868,987 BTC as of May 2025), Bitcoin is increasingly being viewed as a hedge against inflation and fiat currency debasement. Related:&nbsp;Will Bitcoin bulls secure $110K before BTC’s $13.8B options expiry? This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. 

Bitwise predicts that Bitcoin inflows will reach 420 billion USD by 2026.