Spot Bitcoin ETFs have dominated the headlines in 2025, but one name stands out far above the rest.
BlackRock’s IBIT has absorbed nearly all of the net inflows in the sector this year.
According to on-chain ETF flow data, total Bitcoin ETF inflows are up $26.9 billion year-to-date, yet $28.1 billion of that comes from BlackRock’s IBIT alone.
Remove IBIT from the equation, and flows across the rest of the market are negative, down roughly $1.27 billion.
That imbalance is reshaping how analysts view the coming altcoin ETF wave, and it could decide which institutions dominate crypto’s next phase.
No BlackRock, no party?
BTC ETFs are up $26.9bn YTD, yet $28.1bn stems from BlackRock’s IBIT. Ex-IBIT, flows are negative.
BlackRock is absent from the imminent altcoin ETF wave. Opportunity for competitors to secure strong flows, but on net, likely limiting for overall flows. pic.twitter.com/erAERGLxX2
— Vetle Lunde (@VetleLunde) October 28, 2025
The BlackRock Effect
No other fund has managed to attract comparable momentum.
BlackRock’s $28B IBIT ETF has been the only spot Bitcoin ETF with sustained positive inflows throughout 2025.
For context, IBIT’s inflows alone outsize the combined total of Fidelity, Ark, VanEck, and Bitwise by a factor of ten.
This dominance is not just about brand recognition, it’s about trust and distribution.
BlackRock sits at the intersection of traditional wealth channels and institutional compliance, giving IBIT an unmatched inflow pipeline.
Yet despite its success with Bitcoin, BlackRock is absent from the next big wave, altcoin ETFs.
That leaves the door wide open for competitors like Fidelity, Grayscale, and Bitwise to capture early market share in products tied to Ethereum, Solana, and Avalanche.
But on the whole, analysts believe the absence of IBIT-scale capital could limit overall flows in the next ETF cycle.
SEC Decision Looms
All eyes are now on Friday, the deadline for the U.S. SEC to respond to BlackRock’s proposal for a staking-enabled Ethereum ETF.
If approved, it would be the first ETF in the U.S. market to offer both spot exposure and on-chain staking yield, a hybrid that could redefine how institutions interact with Ethereum.
That’s why the timing of this decision matters.
While ETF inflows drive Bitcoin’s price narrative, staking efficiency and validator performance underpin Ethereum’s.
The SEC’s decision could bridge those two worlds, if it allows ETFs to participate in staking rewards directly.
The SEC has until Friday to respond to BlackRock regarding its staking-enabled ETH ETF product.
Here’s the current breakdown of the ETH staking economy and how it might change post approval 👇
1. Lido. Lido currently has 8.46 million ETH Staked. It’s by far #1 (23.4% market… pic.twitter.com/nF1JzlE75o
— Michael Nadeau | The DeFi Report (@JustDeauIt) October 28, 2025
Inside the Ethereum Staking Landscape
Ethereum’s staking economy is now a $100B+ market, and the competitive landscape is shifting fast.
Here’s the current breakdown of who controls staked ETH, and how that balance could change if institutional staking ETFs go live:
1. Lido remains the dominant player, with 8.46 million ETH staked, representing 23.4% of total market share.
Yet total staked ETH on Lido is down 13.7% over the past 18 months, signaling fatigue in traditional liquid staking models.
2. Across the broader liquid staking sector, both Lido and Rocket Pool lost over 1.4 million ETH in total staked assets over the last year.
3. Binance has quietly climbed into the 2 position, with 3.3 million ETH staked.
Coinbase, meanwhile, has 2.4 million ETH but saw its market share fall by 39% year-over-year.
Combined, the major centralized exchanges now control 21.9% of total staked ETH.
4. The biggest growth, however, comes from specialized institutional staking providers.
Collectively, they added 1.28 million ETH to their total over the past year.
Blockdaemon is up 126%.
Figment grew 75%.
Kiln expanded 4.3%.
This is the segment analysts believe will become the engine room of the next generation of staking-enabled ETF products.
The Institutional Staking Era
Here’s the key:
- ETF issuers won’t run their own validators.
They’ll rely on specialized providers, like Blockdaemon, Kiln, and Figment, to handle network operations, validator uptime, and yield optimization.
These providers effectively become the “backend machines” of institutional staking.
They:
- Secure the Ethereum network
- Manage validator infrastructure
- Optimize reward distribution
- Maintain OFAC compliance for regulated entities
This arrangement allows asset managers like BlackRock to offer staking yield exposure without directly touching validator infrastructure or non-compliant assets.
In essence, these providers will operate as the engine room of institutional staking, the invisible layer powering on-chain yield for ETF investors.
From Crypto-Native to Institutional-Grade
Ethereum staking has evolved from a crypto-native yield activity to a regulated, institutional-grade market in just two years.
In 2022, staking was dominated by DeFi protocols and enthusiasts running solo nodes.
By 2025, that model has been largely replaced by custodial and compliance-ready solutions, tailored to institutional frameworks.
If the SEC greenlights staking-enabled ETFs, it could accelerate this transformation.
Institutional liquidity would flow not just into spot ETH exposure, but also into validator-managed yield, introducing a dual-revenue stream that merges traditional finance with decentralized infrastructure.
That’s why analysts are calling the upcoming ruling one of the most pivotal ETF decisions since Bitcoin’s approval in January.
What Happens Next
If BlackRock’s ETH ETF gets the green light, expect three immediate shifts:
1. Validator demand surges, Institutional providers like Blockdaemon and Figment could see onboarding requests spike.
2. Exchange share shrinks further, Centralized platforms like Binance and Coinbase may lose more of the staking market to regulated validators.
3. ETH yield products multiply, Competing asset managers will rush to issue staking ETFs, potentially creating a wave similar to early Bitcoin fund competition.
On the other hand, if the SEC denies staking functionality, the altcoin ETF cycle may open without yield exposure, making it harder to attract meaningful inflows compared to Bitcoin.
That would confirm what the data already hints:
Without BlackRock’s presence, total ETF flows will remain net-negative.
The story here isn’t just about ETFs, it’s about institutionalization.
Bitcoin proved that regulated funds can attract billions in capital in months.
Ethereum now has the chance to prove that on-chain yield can be packaged just as cleanly.
As of late October 2025, BlackRock remains the heartbeat of the ETF market, carrying the entire sector on its $28B shoulders.
But the next phase belongs to whoever bridges staking and compliance, the two pillars of institutional Ethereum.
Because this time, the real innovation isn’t in the token.
It’s in the infrastructure that makes it investable.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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Source: https://nulltx.com/blackrock-dominates-bitcoin-etfs-ethereums-staking-economy-might-be-next-to-boom/