Institutional demand is shifting from Bitcoin to Ethereum and Solana amid new ETF momentum

As the crypto market enters the third quarter of 2025, technical factors such as corporate treasury flows, the rise of spot exchange-traded funds (ETFs), and strategic staking integrations are being predicted to become the dominant catalysts steering the price of ETH and SOL.

The fundamentals may be taking the back seat for now, according to a recent report by Coinbase.

Bitcoin still retains a lion’s share of market cap dominance, about 63%, but recent investor behavior points to a shift. Ethereum and Solana are increasingly drawing attention as undervalued alternatives, offering a combination of narrative potential and tradable liquidity, especially as new institutional vehicles open up.

ETF momentum and the corporate treasury effect

ETH ETFs have drawn more than $2.27 billion in net inflows in July alone, with daily inflows peaking at $726 million.

Solana, once seen as a retail-dominated chain, is also riding this wave. The REX-Osprey Solana + Staking ETF, while not yet SEC-approved, saw $73 million in early allocations from U.S. institutions. Regulatory watchers now peg the odds of a spot SOL ETF approval at 99%, driven by a favorable shift in the SEC’s ETF evaluation framework.

Corporate treasuries are another new force behind this momentum. As of July 18, more than 825,000 ETH worth approximately $3 billion and 2.95 million SOL worth about $531 million have been acquired by 14 institutional entities, per Coinbase data.

Many of these corporate players are not only holding ETH and SOL, they’re staking them to earn yield. This marks a departure from the short-term, speculative nature of past crypto treasury plays and signals a fundamental shift toward long-term allocation strategies.

The yield generation potential of both assets, particularly when coupled with the rising media attention around stablecoins and tokenized securities, has made them ideal candidates for corporate balance sheets.

Technicals dominate, fundamentals lag

While Ethereum’s tokenomics and real-world asset (RWA) integrations, including recent upgrades like EIP-9698 and EIP-7983, are important, they have yet to materially impact price performance.

Instead, technical flows are taking center stage. In May, Ethereum experienced one of its largest short squeezes in over a year, with $897 million in ETH shorts liquidated. This technical unwind triggered a rapid rally, highlighting how market structure rather than development roadmaps now drives performance.

Ethereum’s beta to the crypto market (proxied by the COIN50 index) has also climbed, hitting 0.92 in July, a sign that ETH now moves almost in lockstep with the general market, reinforcing its use in barbell strategies that balance riskier altcoin exposure.

Solana’s price movement follows a similar logic. While it has gained headlines for memecoin trading dominance, thanks to platforms like Pump.fun, and LetsBonl, Coinbase predicts that its price action in Q3 will be increasingly linked to liquidity flows from ETFs and corporate allocations.

New narratives, shared tailwinds

Ethereum is consolidating its role as an infrastructure layer for tokenized real-world assets, payments and stablecoins, a theme boosted by the recent passage of the GENIUS Act in Washington.

Solana, meanwhile, is showcasing real throughput, with over 44% of meaningful blockchain activity, according to Dune Analytics data.

Institutional eyes are now on Solana’s upcoming Alpenglow upgrade, which aims to transform its consensus layer by speeding up finality and cutting validator costs. Yet Coinbase’s report argues such fundamental changes are unlikely to affect short-term price.

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