Bitcoin News Today: BlackRock Overtakes Exchanges as Top Crypto Custodian

US Bitcoin Spot ETFs experienced a net outflow of $126.7 million as of August 30, 2025, according to the latest data, with BlackRock’s iShares Bitcoin Trust (IBIT) adding $24.6 million to its holdings while Fidelity, ARK, and Grayscale saw declines. This shift reflects a broader trend in institutional behavior, as investors increasingly favor regulated ETFs for crypto custody. BlackRock’s ETF now holds 745,357 Bitcoin, surpassing the holdings of major exchanges like Coinbase (706,150 BTC) and Binance (584,557 BTC), marking a significant shift in the custody landscape of crypto assets [1]. The trend suggests that institutional investors are moving away from direct exchange custody in favor of more compliant and secure investment vehicles [2].

In parallel, the iShares Ethereum ETF has accumulated 3.6 million ETH, placing it just 200,000 ETH behind Coinbase, which holds 3.8 million. Binance, with 4.7 million ETH, remains the largest custodian of Ether. However, BlackRock’s rapid accumulation of ETH—adding 1.2 million in less than two months—suggests it could surpass Coinbase by the end of the year. This dynamic illustrates a structural shift in the Ethereum custody market, where institutional demand is increasingly being channeled through regulated ETFs rather than centralized exchanges [1]. This trend is particularly notable given the declining reserves of Coinbase, which has seen its ETH holdings drop by over 52% since 2019 [3].

The declining inflows of Bitcoin and Ether into exchanges, such as Coinbase and Binance, further reinforce the growing preference for ETFs among investors. Data from CryptoQuant indicates that the 30-day moving average of Bitcoin inflows has fallen to its lowest level since May 2023, while Ethereum inflows have also seen a sharp decline. These trends suggest that investors are less inclined to sell their holdings at current price levels, which are near $111,000 for Bitcoin and $4,600 for Ethereum. The reduced exchange inflows, combined with increased ETF accumulation, point to a tightening of supply in the market, which could support further upward price movement [1].

BlackRock’s growing role as a top institutional custodian of both Bitcoin and Ethereum has positioned it as a key player in the crypto market. This development has significant implications for the structure of the market, as it reflects a broader shift in how institutional investors are allocating capital. The firm’s Bitcoin ETF has become the largest institutional holder of BTC, a position once occupied exclusively by crypto exchanges. This shift underscores the increasing legitimacy of regulated ETFs as investment vehicles in the digital asset space [2]. It also highlights the growing influence of traditional financial institutions in a market that has historically been dominated by decentralized platforms.

The market dynamics are further supported by the broader trend of declining investor activity on exchanges. Both retail and institutional investors are showing signs of reduced selling pressure, with the average daily inflow of Ethereum into exchanges dropping to just 25 ETH per day over the past 30 days—a level last seen in April 2024 when the price of ETH was significantly lower. This shift in investor behavior is indicative of a more cautious and long-term approach to crypto asset management, with investors prioritizing stability and compliance in an increasingly regulated environment [3].

Overall, the evolving custody landscape and investor behavior suggest that the market is undergoing a structural transformation. As institutional investors continue to favor regulated ETFs over traditional exchange custody, the role of crypto exchanges may diminish further. This trend is likely to have long-term implications for the market structure, with firms like BlackRock playing an increasingly central role in shaping the future of crypto asset management [2].

Source:

[1] BlackRock Bitcoin ETF Surpasses Coinbase and Binance in Holdings (https://coincentral.com/blackrock-bitcoin-etf-surpasses-coinbase-and-binance-in-holdings/)

[2] BlackRock Becomes Top Institutional Bitcoin Holder (https://www.cointribune.com/en/blackrock-becomes-top-institutional-bitcoin-holder/)

[3] Will BlackRock's Bitcoin ETF holdings surpass Coinbase and Binance (https://www.idnfinancials.com/news/56891/will-blackrocks-bitcoin-etf-holdings-surpass-coinbase-and-binance)