Bitcoin hits all-time high of $118,802, driven by ETFs and institutional inflows: 3 key points shaping the new bull run

Bitcoin is showing no signs of slowing down. On Friday morning, the world’s largest cryptocurrency hit a new all-time high of $118,802, marking a 101% yearly gain and outpacing nearly every other major asset class. The surge came on the back of $1.18 billion in ETF inflows, the second-highest daily figure ever, combined with a $453 million short squeeze that accelerated the rally by forcing bearish positions to liquidate.

BTC has hit 6.91% in the past 24 hours, and is trading at $118,802.39 at the time of publishing of the report, according to CoinMarket Cap data. The Fear & Greed Index now signals “greed,” reflecting strong investor sentiment and sustained buying interest. Additionally, institutional participation remains a key driver, with $1.52 billion flowing into crypto funds over the last five trading days.

Experts say behind this momentum may be a structural shift: where institutions are driving the charge. With over 15-18% of Bitcoin’s supply estimated to be held by institutions and corporate treasuries, Bitcoin’s profile is changing fast, and it's no longer a retail investor's game only. "Bitcoin's new all-time high is a clear sign that confidence in crypto is growing stronger. Institutional demand is rising, supported by more favourable signals from the Trump administration in the U.S. This rally is not just about price; it reflects how crypto is maturing into a recognised asset class within the global financial system," Ashish Singhal, Co-founder, CoinSwitch tells Fortune India.

So what’s driving this institutional surge? And what does it mean for the retail investors who started the crypto movement, which now seems to have moved to institutional investors holding the driving seat? Here's a breakdown of the three biggest forces behind BTC's record run:

1. Institutions drive BTC's record rally

Bitcoin’s latest rally reflects its evolution from a speculative asset to a credible store of value — a shift driven by surging institutional demand and the 2024 launch of spot Bitcoin ETFs like BlackRock’s iShares Bitcoin Trust (IBIT), which have attracted billions in inflows. "These ETFs offer a regulated, accessible way for institutions to invest without managing crypto directly,” says Himanshu Maradiya, Founder & Chairman of CIFDAQ. "Bitcoin’s appeal as an inflation hedge and its growing legitimacy also attract firms like MicroStrategy and public companies, reducing supply for others."

The growing institutional ownership is a sign of broader market maturity. "This trend underscores a broader institutional acceptance of digital assets as part of a diversified portfolio," says Kushal Manupati, Regional Growth & Ops Lead, South Asia at Binance. "It also signals a maturation of market infrastructure, driven by clearer regulations, improved custodial solutions, and the rise of regulated financial products like Bitcoin ETFs."

Unlike previous retail-driven bull cycles, the current rally is being led by institutions. In just the last two quarters, corporations have added a record 159,107 BTC to their balance sheets, pushing total corporate holdings to around 847,000 BTC. Edul Patel-led Mudrex attributes this to improving regulatory clarity and Bitcoin’s evolving risk-return profile. "Institutions are increasingly viewing it as digital gold," Patel says. "As adoption deepens, Bitcoin’s role in diversified portfolios will likely grow."

Estimates place institutional holdings at 15-18%, according to Bitcoin Treasuries. "What's clear is the growing conviction among large investors," says Sumit Gupta, Co-Founder at CoinDCX. "This shift underscores Bitcoin’s evolution into a credible, long-term asset class."

2. ETFs extending Wall Street's playbook

BlackRock’s Bitcoin ETF hit $70 billion in assets under management in just 341 days, five times faster than gold ETFs, underscoring the pace of institutional adoption. Spot ETFs have unlocked an estimated $50-$148 billion in inflows, tightening supply and draining exchange reserves. Companies like MicroStrategy and Semler Scientific now treat Bitcoin as a strategic treasury asset. "This institutional capital influx, evidenced by giants like Goldman Sachs, Morgan Stanley, and hedge funds like Renaissance Technologies loading up on ETFs, signals a seismic shift," says Sumit Gupta, Co-Founder at CoinDCX.

In the post-Trump 2.0 era, Bitcoin's reputation as a "strategic reserve" has surged, with the U.S. government itself holding over 200,000 BTC. ETFs are easing compliance, tax, and custody concerns that once kept institutional players on the sidelines. "The success of these ETFs has spiked trading volumes, enhanced liquidity, and even paved the way for ether ETFs," says CIFDAQ’s Himanshu Maradiya. "They've shifted crypto’s image from a niche gamble to a mainstream asset."

ETFs have also standardised crypto access for capital markets, eliminating the need for private keys or wallets. "ETFs bridge the gap between centralised finance and decentralised assets, offering scalability and compliance without undermining blockchain’s innovation," adds Kushal Manupati of Binance.

The SEC’s green light for spot Bitcoin and Ethereum ETFs has lowered adoption barriers, cementing crypto's role in institutional portfolios. "Since ETFs handle custody and security, making crypto investing less risky, investors see it as an attractive alternative to traditional assets," says Edul Patel, CEO of Mudrex.

3. Retail is not out but evolving with BTC Ecosystem

As Bitcoin ETFs gain traction and prices soar, there’s growing concern that the average investor is being priced out of the revolution they helped start. But that’s a misconception, say industry experts. "Bitcoin is highly divisible, down to 0.00000001 BTC, and retail users can start investing with just a few dollars,” says Kushal Manupati of Binance. “Retail users haven’t been priced out or left behind; they’ve evolved alongside the market."

Still, the visibility and influence of institutional investors have reshaped the narrative. While institutional capital dominates headlines, retail investors remain a core part of the ecosystem. "Bitcoin hasn’t outgrown retail, it’s growing up with them," says Sumit Gupta, Co-Founder at CoinDCX. "The best part about crypto assets is tokenisation and micro-ownership. You don’t need to buy a whole Bitcoin; anyone in India can start investing with as little as ₹100. Accessibility is the true power of this asset class."

ETFs have further widened access by offering a regulated way for retail investors to gain exposure without needing to hold crypto directly. "The institutional momentum is not sidelining retail but strengthening it," says Himanshu Maradiya of CIFDAQ. "As trust in the asset class deepens, retail investors are more likely to follow, entering the market with greater conviction."

Mudrex’s Edul Patel adds that while institutions are now driving the market, the ecosystem still benefits everyone. "With participation from ETFs, corporate treasuries, and asset managers, Bitcoin is gaining legitimacy as a mainstream asset. That trust trickles down to retail."