XRP and Solana surpass Bitcoin and Ethereum as top choices for institutions in 2025

For many years, the institutional strategy for the cryptocurrency sector was straightforward: acquire Bitcoin, possibly explore Ethereum, and disregard the rest.

In 2025, that strategy underwent a significant transformation.

Although Bitcoin maintained its position as the largest asset by overall volume, the noteworthy development of the year was a profound structural change in the allocation of new capital.

As reported by CoinShares at the end of the year, the age of “Bitcoin-only” supremacy has transitioned into a tiered market structure where Ethereum has established itself as a fundamental holding, while XRP and Solana have surfaced as the inaugural true “institutional alt majors.”

The statistics illustrate a clear shift in investor behavior. While Bitcoin investment products attracted $26.98 billion in inflows for 2025, this amount marked a 35% decrease from the record-breaking pace of 2024.

Conversely, capital flowed into alternative networks at unprecedented levels.

Ethereum products experienced a 138% increase in inflows, while XRP and Solana recorded growth rates of approximately 500% and 1,000%, respectively, effectively doubling their asset bases within a single calendar year.

This divergence indicates a maturing market that is shifting from broad, speculative diversification to a focused, concentrated elite.

The advancement of Ethereum and the ‘velocity’ of new majors

The data from 2025 implies that institutional allocators have fundamentally redefined Ethereum’s status.

Previously regarded as a high-risk satellite to a Bitcoin core, the second-largest cryptocurrency has ascended to the level of a primary portfolio asset.

According to CoinShares’ report, Ethereum attracted $12.69 billion in net new investment during 2025, up from just $5.33 billion the previous year.

This 138% year-over-year increase occurred even as Bitcoin flows slowed down, suggesting that investors are becoming more comfortable holding independent perspectives on the two assets rather than treating them as a correlated pair.

With total assets under management (AUM) for Ethereum products concluding the year at $25.7 billion, the network has reached a scale that necessitates inclusion in diversified digital portfolios.

However, the most aggressive repricing of risk took place in the following tier.

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XRP and Solana, which have long contended for third place in the market hierarchy, witnessed a flow of capital that far surpassed the majors.

XRP investment products absorbed $3.69 billion in 2025, representing a nearly five-fold increase from the $608 million recorded in 2024. Solana’s rise was even more pronounced, attracting $3.56 billion compared to just $310 million a year earlier, marking a tenfold expansion.

The significance of these figures lies not only in their growth rates but also in their scale compared to the existing market.

At the beginning of 2025, the investment product ecosystems for XRP and Solana were relatively small. By the end of the year, inflows into both assets were approximately equal to their total ending assets under management, roughly $3.5 billion each.

In financial terms, this denotes a “replacement rate” of nearly 100%. While Bitcoin’s inflows constituted about 19% of its total AUM and Ethereum’s accounted for 49%, Solana and XRP effectively turned over their entire cap tables, indicating a substantial influx of new institutional holders entering the market for the first time.

The demise of the long tail

If 2025 marked a breakthrough year for the top tier, it served as a sobering reality check for the remainder of the market.

Excluding Bitcoin, Ethereum, XRP, Solana, multi-asset baskets, and short-Bitcoin hedging products, the “remaining altcoins” category—which encompasses established names like Cardano, Litecoin, and Chainlink, as well as emerging competitors like Sui—saw inflows plummet.

This category attracted only $318 million in 2025, a 30% decline from $457 million in 2024.

This contraction indicates a significant hardening of the investment landscape. In previous cycles, retail enthusiasm often spilled over into hundreds of smaller tokens, fueling widespread rallies.

The era of ETFs and ETPs (Exchange Traded Products) seems to operate differently. Regulatory barriers and liquidity requirements create substantial obstacles for new financial products.

Consequently, asset managers are reluctant to launch products for tokens that lack regulatory clarity or sufficient liquidity. Without those regulated frameworks, institutional capital cannot easily access the long tail.

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The outcome is a “winner-take-most” dynamic. As capital consolidates around the four assets that have established liquid, regulated investment vehicles, the liquidity gap between the “majors” and the “minors” expands.

This creates a self-reinforcing cycle: since Solana and XRP possess the liquidity and products, they attract inflows; because they draw in inflows, their liquidity further deepens, making them even more appealing for the next wave of institutional participants.

Meanwhile, assets outside this favored group confront a liquidity drought, struggling to capture the passive flows that now significantly contribute to the appreciation of the crypto market.

The model portfolio for 2026

The solidification of this hierarchy carries significant implications for how digital asset portfolios will be structured in 2026 and beyond.

The “Bitcoin-only” maximalist approach, while still justifiable as a conservative strategy, is ceding market share to multi-sleeve models.

Financial advisors and wealth managers, who previously found it challenging to justify exposure beyond Bitcoin, now have evidence to advocate for a diversified core.

The emerging standard model appears to be evolving toward a weighted basket: Bitcoin as the digital commodity and anchor; Ethereum as the foundational smart contract layer; and Solana and XRP as high-growth “satellites” representing strategic bets on speed, scalability, and payment utility.

The CoinShares data supports this perspective, indicating that while Bitcoin is becoming a lower-beta asset, stable and substantial yet slower-growing, the alpha is now being sought in these newly minted majors.

Significantly, the presence of $105 million in short-Bitcoin product inflows and a total AUM of $139 million in that category further indicates a maturation in how these tools are utilized.

This suggests that institutions are not merely accumulating; they are hedging.

The ability to short the market leader while going long on high-beta satellites facilitates sophisticated relative-value trades that were once the domain of crypto-native hedge funds, not regulated asset managers.

The risks of a narrow market

While the emergence of new majors signifies maturity, it also brings forth new risks.

The focus of inflows into just four assets means that the overall health of the entire ecosystem is becoming increasingly reliant on the performance of a select few networks.

The “velocity” witnessed in Solana and XRP, where inflows equaled total AUM, presents a double-edged sword. Such rapid growth suggests that a significant portion of the holder base is new.

In contrast to Bitcoin’s entrenched base of “hodlers” who have endured multiple 80% drawdowns, these new institutional participants may be more sensitive to price fluctuations. If the narrative shifts or regulatory challenges resurface, the same standardized products that attracted capital could enable a swift exit.

Moreover, the neglect of the long tail raises concerns about innovation.

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If capital is systematically directed solely towards the largest incumbents, new protocols may find it difficult to achieve the valuation momentum necessary to attract talent and secure networks.

The industry risks becoming top-heavy, with trillions of dollars in value anchored to four chains while the broader ecosystem stagnates.

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