Bitwise Report: 20% of Bitcoin Supply Could Be Held by Institutions by 2026

Bitwise and UTXO Management have released a report suggesting that 20% of all Bitcoin (BTC) could be held on institutional balance sheets by the end of 2026. The report, titled “Exploring the Game Theory of Hyperbitcoinization,” outlines five demand channels for Bitcoin, with nation-states leading the way. According to the report, nation-states could allocate $161.7 billion to Bitcoin, equivalent to 1.62 million BTC, by swapping 5% of their existing gold reserves. This allocation represents 7.7% of the total 21 million BTC cap.
Wealth-management platforms, which oversee approximately $60 trillion in assets, could direct $120 billion into spot Bitcoin exchange-traded funds (ETFs) if clients opt for a 0.2% position in their portfolios. Public companies, which already hold over 600,000 BTC collectively, could add another 1.18 million coins, valued at $117.8 billion, as fair-value accounting rules and peer competition drive treasury adoption. Additionally, 13 US state reserve bills could translate to a modeled $19.6 billion purchase, while sovereign-wealth funds account for a $7.8 billion base case. The combined flows total $427 billion, equivalent to 4.27 million BTC, or 20% of the total supply.
The report highlights the first-year performance of spot Bitcoin ETFs in the US, which attracted $36.2 billion of net inflows and surpassed gold-ETF assets in one-twentieth the time it took SPDR Gold Shares after its launch. The report argues that major wirehouses and private banks will soon open ETF access, transforming dormant interest into orders. Once holdings accumulate, the report anticipates a pivot toward BTC-denominated yield, valuing the nascent Bitcoin finance market at $100 billion if only 5% of a $2 trillion Bitcoin capitalization seeks on-chain lending, basis trades, or bridge-operator fees. Firms such as Strategy and Metaplanet leverage these tools to expand reserves without new equity issuance.
Favorable policies in the US also add a structural bid. The BITCOIN Act, reintroduced by Senator Cynthia Lummis in March, would direct the Treasury to buy 200,000 BTC annually for five years. Meanwhile, President Donald Trump signed an executive order in March to establish a Strategic Bitcoin Reserve with 198,000 seized coins. Parallel state bills cap BTC at up to 10% of rainy-day funds, reinforcing what the authors describe as a game-theory loop. Each cohort that accumulates removes circulating supply, lifts price floors, and pressures lagging peers to act.
Bitwise and UTXO conclude that the interplay among sovereigns, corporations, and wealth platforms could push adoption beyond speculative trade into portfolio mechanics and public finance policy. The report frames this progression as a step toward “hyperbitcoinization,” which will be driven by balance-sheet management rather than market sentiment and result in institutions accumulating roughly 20% of the Bitcoin supply by 2026.

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