BlackRock emerges as dominant custodian for Bitcoin and Ether

BlackRock is quickly establishing itself as the top custodian for Bitcoin (BTC) and Ether (ETH), as its ETFs reshape the market dynamics in 2025. With its rapid accumulation of both assets, BlackRock is gaining significant ground on existing custodians and may soon surpass them in total holdings.

The iShares Ethereum ETF from BlackRock is on the brink of surpassing Coinbase as the world’s second-largest ETH custodian, closing the gap to just 200,000 ETH. BlackRock’s holdings now stand at 3.6 million ETH, having added 1.2 million ETH in under two months. At this rate, BlackRock could overtake Coinbase by the end of the year and narrow Binance’s dominance to just 1.1 million ETH.

Binance remains the largest custodian of ETH with 4.7 million ETH, a substantial increase from 2.5 million ETH in 2019. However, Coinbase, which once held over 8 million ETH in 2019, has seen its reserves shrink by 52% to just 3.8 million ETH.

This dramatic shift signals a structural realignment in the market, as institutional investors increasingly favor regulated ETFs over exchange-based custody. The growth of ETF holdings is also reducing the liquid supply of ETH, reflecting stronger institutional conviction in the asset.

BlackRock’s dominance extends to Bitcoin

The momentum is not confined to Ether. BlackRock’s iShares Bitcoin ETF (IBIT) has rapidly expanded its holdings, reaching 745,357 BTC, surpassing Coinbase at 706,150 BTC and Binance at 584,557 BTC. These developments underscore BlackRock’s emergence as the largest institutional custodian across both Bitcoin and Ether, solidifying its influence over the crypto market structure.

Meanwhile, Bitcoin and Ether inflows across exchanges are showing signs of contraction. According to CryptoQuant, the 30-day moving average of BTC inflows has dropped to its lowest level since May 2023, while BTC trades near $111,000. Both Coinbase and Binance have reported historically low deposit levels, suggesting reduced selling pressure from both retail and institutional investors.

The same trend is apparent in Ether. The 30-day simple moving average (SMA) for ETH inflows has dropped to 25 ETH, the lowest since April 10, when ETH traded at $1,700. Despite ETH now nearing $4,600, exchange inflows have remained weak, suggesting that investors are reluctant to sell and reinforcing confidence in current market levels.

ETF inflows highlight growing institutional demand

The lack of inflows on exchanges is contrasted by the surge in ETF inflows. Ether ETFs have seen more than $1.5 billion in net inflows since last Thursday, including a substantial $450 million in a single day.

In contrast, Bitcoin ETFs experienced significant outflows last week, totaling $1.17 billion. However, recent data shows renewed buying pressure, with nearly $310 million in inflows over the past two days.

Together, the decline in exchange inflows and the rise in ETF accumulation highlight a tightening supply backdrop for both BTC and ETH, potentially setting the stage for sustained bullish momentum through the remainder of the year.