WisdomTree, one of the world’s largest asset managers with significant influence in the crypto market, recently published a report stating that Bitcoin’s traditional boom-and-bust cycles have given way to a market led by institutional capital.
The asset manager points to lower structural volatility and consistent fund inflows as evidence that investor behavior is shifting from retail speculation to professional portfolio discipline. Analyzing this report raises the crucial question of whether large institutions will monopolize the crypto market, marking the end of true decentralization of power.
Volatility has decreased, and flows persist
According to the firm’s report, Bitcoin’s ongoing volatility has decreased to the 30% to 50% range, reducing its risk profile compared to other tangible assets. The firm cites this structural reduction in volatility as a sign that large, long-term investors are mitigating short-term price fluctuations.
Fund flows provide a complementary signal. The report reveals that its own Bitcoin Fund (BTCW) attracted inflows of $6.78 million —in a period when, otherwise, widespread market pressure might have driven outflows. This pattern, according to the firm, supports the prospect of sustained institutional demand rather than episodic rallies driven by retail trading.
Why the paradigm shift?
WisdomTree links part of the shift to clearer regulatory frameworks. In a blog post from November 18, 2025, the firm described 2025 as “the year clarity came to cryptocurrencies,” stating that regulation has acted as a filter, channeling capital toward custody, governance, and reporting structures that comply with regulations. This, in turn, has made allocators more comfortable treating Bitcoin as a tradable portfolio rather than a speculative novelty.
However, regulation always has a negative impact on the development of technologies whose main virtue is the financial freedom they offer users. Excessive legislation could undeniably limit technologies that thrive on freedom and creativity.
Continuing with the report, “The adolescence of cryptocurrencies is over,” stated Dovile Silenskyte, director of digital asset research at WisdomTree. She added that capital now behaves more like institutional capital.
The transition described by WisdomTree has practical consequences. For investors, lower volatility and consistent inflows could alter the size of the allocation and risk budgeting in multi-asset portfolios.
The concentration of large portions of the circulating supply of cryptocurrencies like Bitcoin (or even Ethereum) in the hands of a few, such as large investment funds, undoubtedly threatens to reduce the true decentralization of market power. These mega-whales have the power to make asset prices fall or rise as they see fit.
