Asset management firm Bitwise Asset Management reported an impressive result for the first half of 2026: net inflows of new investments exceeded $1.8 billion. These figures, released by the company's CEO Hunter Horsley, look particularly striking against the backdrop of the overall bearish dynamics of the crypto market, where most digital assets have noticeably declined in value.
Fundstrat co-founder and head of research Tom Lee called this outcome outstanding. And it's hard to disagree: money flowed into Bitwise products despite falling prices. Notably, three of the company's four key product lines generate passive income for investors — this fundamentally changes the approach to investing in digital assets.
Where exactly did the money go?
Horsley reported that four areas attracted $100 million or more each. These include exchange-traded funds (ETFs and ETPs), private strategies, staking, and volatility products. However, the key point is different: three of these areas generate yield rather than simply holding assets.
For example, the Vault product, launched in January in partnership with on-chain lender Morpho, targets 6% annual returns on stablecoins. The tokenized Crypto Carry Fund managed $259 million in assets by the end of May and generated 4% annual returns. The fund's essence is simple: the manager buys cryptocurrency, sells futures on it, and earns from the difference — a classic carry-trading strategy.
Staking grew particularly fast. The Bitwise thematic fund on Solana surpassed the $500 million mark just 18 days after its launch in November. Significantly, competitors are also rushing to bring Ethereum yield into ETP products — the market is clearly shifting toward generating passive income.
The flip side of the coin
However, not all Bitwise products proved successful. The Bitwise 10 Crypto Index ETF (BITW), focused exclusively on price appreciation, faced significant outflows. Net assets declined from $1.03 billion on December 31 to $678 million on March 31 — down 34% in three months.
The reasons are obvious: the share price fell by 24%, and investors withdrew about 2.25 million shares, representing approximately 13% of the fund's capital. Meanwhile, the fee was reduced from 2.50% to 0.75% after listing on NYSE Arca in December. However, in 2024, the same fund showed growth of 94.8% — volatility here is extreme.
The wave of layoffs in August, when staff was reduced from 180 to 155 people, also confirms that the company is adapting to new market realities.
My view: Net inflows reflect only deposits, not profits from asset value appreciation. Investors within Bitwise paid for yield, not for price — this signals a structural shift in the crypto industry. In conditions where bitcoin trades near $77,400 and the market shows no confident growth, products with passive income are becoming the main magnet for institutional capital. This is not just a trend, but a new reality that every market participant should consider.