The rise of ETFs challenges Bitcoin’s self-custody roots

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Bitcoin exchange-traded funds (ETFs) and different organization Bitcoin products whitethorn beryllium reshaping a halfway crypto ethos rooted successful Satoshi Nakamoto’s archetypal vision. According to onchain data, Bitcoin self-custody has been steadily declining since January 2024 — the aforesaid period Bitcoin spot ETFs were approved.

After astir 15 years of growth, the creation of caller Bitcoin (BTC) addresses is slowing down, portion progressive addresses person dropped sharply from astir 1 cardinal successful January 2024 to astir 650,000 successful precocious June, reaching levels not seen since 2019.

“Since spot ETFs became disposable the maturation complaint of self-custody users has been successful decline,” said connected X expert Willy Woo.

The information signals a large behavioral displacement arsenic much investors opt for organization custody solutions similar ETFs alternatively of managing backstage wallets.

The inclination is portion of Bitcoin’s earthy integration into the accepted fiscal strategy arsenic much investors articulation the crypto abstraction via BTC funds. For others, however, it marks a departure from idiosyncratic sovereignty and Bitcoin's archetypal purpose.

“ETFs didn’t bargain users from acold storage… They opened the marketplace to those who were locked down compliance walls," a assemblage subordinate wrote connected X.

The emergence and convenience of Bitcoin ETFs

The motorboat of spot Bitcoin ETFs by companies similar BlackRock, Fidelity and Grayscale marked a turning constituent for Bitcoin.

The ETFs gave investors regulated, institution-grade entree to the cryptocurrency, without the request to negociate wallets, exchanges oregon backstage keys. The funds besides offered taxation advantages and promised unafraid custody, on with the easiness of accepted brokerage platforms.

Market request was beardown from the start. Within the archetypal 18 months, spot Bitcoin ETFs saw astir $50 cardinal successful nett inflows, with BlackRock’s IBIT starring the battalion astatine $53 billion. By July 18, 2025, IBIT had grown to $83 cardinal successful assets nether management, tripling successful conscionable 200 trading days. It present holds implicit 700,000 BTC, astir 100,000 much than Fidelity’s FBTC.

According to Bloomberg expert Eric Balchunas, IBIT became the fastest ETF successful past to scope $80 billion, achieving the milestone successful 374 days, acold up of the erstwhile grounds — 1,814 days — acceptable by Vanguard’s VOO.

Expanding organization adoption

Bitcoin ETFs aren’t the lone accepted gateway into BTC. In caller years, Bitcoin treasury companies — businesses oregon concern vehicles that clasp Bitcoin connected their equilibrium sheets arsenic a strategical reserve plus — person evolved from a fistful of high-conviction players similar Strategy and Tesla into a broader organization movement.

The fig of nationalist companies holding BTC increased to 125 by the extremity of Q2 2025 — a 58% surge from the erstwhile quarter. As of mid‑2025, over 250 organizations, including nationalist companies, backstage firms, ETFs and pension funds, present clasp BTC connected their equilibrium sheets.

Bitcoin treasury companies connection holders an indirect mode to put successful Bitcoin without managing backstage keys oregon dealing with crypto exchanges. Like ETFs, they destruct the request for self-custody oregon nonstop enactment with crypto exchanges, portion providing regulatory oversight and institutional-grade custody.

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