How are institutions accessing crypto exposure?

Institutions are using crypto ETFs and spot products to gain exposure to crypto through traditional financial markets, leveraging the optimized infrastructure they are familiar with.

What do blockchains need to do to attract more institutional trading?

To attract significant institutional trading, blockchains will need to surpass the capabilities of existing financial systems and deliver the same level of predictability, speed, and accountability as traditional markets.

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Crypto Institutions Shun Blockchains, Stick to Traditional Rails

11 Nov

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Summary

Crypto ETFs and spot products see record inflows, but trading stays off-chain
Blockchains lack speed, reliability, and resilience required by institutions
Institutions need custom blockchains to meet traditional market standards

Crypto Institutions Shun Blockchains, Stick to Traditional Rails

As of November 11th, 2025, Wall Street's interest in crypto has never been stronger. Major players like BlackRock, Fidelity, and VanEck have launched Bitcoin ETFs and spot crypto products that have seen record inflows. Even the Nasdaq has hinted at expanding its digital asset trading infrastructure.

However, this growing institutional momentum has not translated to increased on-chain activity. The bulk of crypto trading, settlement, and market-making still takes place on private servers and traditional financial rails. The reason is simple - blockchains, in their current form, do not yet meet the performance standards required by large institutions.

Blockchains often struggle with speed, reliability, and operational resilience, causing transactions to fail unpredictably and gas fees to fluctuate erratically. Institutions refuse to operate in such an unpredictable environment, where they cannot ensure trades will settle correctly. Additionally, blockchain latency is still far behind the nanosecond speeds of traditional markets, making it uncompetitive.

To attract significant institutional trading, blockchains will need to surpass the capabilities of existing financial systems. Institutions require custom-built blockchains that can deliver the same level of predictability, speed, and accountability as their current infrastructure. Until then, the largest players will continue to trade crypto exposure through traditional channels, limiting the transparency, liquidity, and innovation that made the crypto space compelling in the first place.

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