Institutional Investors at 72%: Fundamentals Matter for Crypto Investment

For years, in the world of crypto, one thing mattered most: the ranking on CoinMarketCap. Today, that logic is breaking down. More and more investors are seeking fundamentals for investing in crypto that go beyond market cap, looking at revenues, real usage, and a project's ability to generate economic value over time. This is confirmed by leading sources such as Bitwise, Wintermute, and the Arbitrum Foundation, according to which the change pertains to longer time horizons, while in the short term, perpetual futures continue to drive prices day by day.

Summary

• Key Points
• From market cap ranking to fundamental parameters
  • End of the CoinMarketCap ranking era
• Role of perpetual futures and institutional flows
  • Increase in institutional spot trading and focus on revenue-generating tokens
• Divergence between crypto token performance and related stocks
• Importance of verifiable on-chain metrics and project-level analysis
  • Case study: transaction volume and revenue distribution of Arbitrum
• Investment products and strategic vision from industry leaders
  • Grayscale's vision on Bitcoin and emerging digital assets
• FAQ
  • Why are crypto investors moving away from market cap ranking?
  • What role do perpetual futures play in crypto price movements?
  • How has institutional involvement in crypto spot trading changed?
  • What are credible on-chain metrics for evaluating a crypto project?

Key Points

• Crypto investors are shifting their focus from market cap ranking to metrics such as revenues, usage, and value captured by projects.
• The CEO of Bitwise, Hunter Horsley, speaks of the end of the "CoinMarketCap ranking" era.
• Institutional spot trading on Wintermute rose to 72% of OTC flow in the first half of 2026, up from 59% the previous year.
• Crypto tokens fell by 36% in the first half of 2026, while related stocks rose by 23%.
• Arbitrum has surpassed 2.7 billion lifetime transactions and returns 10% of net protocol revenues to its ecosystem.

From market cap ranking to fundamental parameters

The crypto sector is moving away from the logic that a token's value is measured by comparing it to the largest blockchain above it in ranking. In an interview with CoinDesk, Horsley described this shift as the end of the "CoinMarketCap ranking" era: in previous cycles, new layer-1s were often valued as a fraction of the dominant network, and smaller projects ended up being priced at a discount solely for their ranking position.

End of the CoinMarketCap ranking era

That approach is losing ground as investors focus on addressable markets, real adoption, and a project's ability to capture economic value, Horsley explained. The cited example is Hyperliquid: today, those evaluating the HYPE token look at trading activity and the economics of the derivatives platform, not its relative position compared to other blockchains. The token has risen by about 20% in the past year. "When we talk to wealth managers from a company that has just approved access to the sector, they have no idea where something ranks on CoinMarketCap," Horsley said. "It's irrelevant."

This change matters because it redefines who wins and who loses in the long run: a project with real adoption and verifiable revenues can now attract institutional capital even without a prominent place in traditional rankings, while those relying solely on positioning risk falling behind.

Role of Perpetual Futures and Institutional Flows

In the short term, perpetual futures continue to determine the price, but it is the fundamentals that establish which tokens survive and which are selected by allocators in the medium term. Jasper De Maere, an OTC trader at Wintermute, explained to CoinDesk that fundamentals and trading flows matter over different time horizons: the volumes of perpetual futures continue to be a multiple of spot for most major tokens, while funding, positioning, and liquidations define the intraday tone.

Increase in Institutional Spot Trading and Focus on Revenue-Generating Tokens

However, in the last 12-18 months, attention has shifted from infrastructure to applications and app chains, areas more familiar to those coming from fintech and venture capital, according to De Maere. "Fundamentals set the floor and the shortlist, while flows set the price," he stated. Revenues and usage determine which tokens withstand drawdowns or make it onto allocators' lists, but they rarely dictate the price of a single day.

Data on flows from Wintermute show that the most significant change concerns who is buying. This is not a massive migration from spot to derivatives: institutional counterparties accounted for about 72% of the company's OTC spot flow in the first half of 2026, compared to around 59% a year earlier. These flows have concentrated on major cryptocurrencies and a limited list of revenue-generating tokens, with tokenized real-world assets emerging as the main new category.

De Maere added an important clarification: "Part of the outperformance of revenue-generating tokens reflects the fact that fundamentals are being rewarded, and part reflects the fact that fundamentals are the narrative of the moment, so those tokens attract the flows. The two are difficult to separate."

Divergence Between Crypto Token Performance and Related Stocks

In the first half of 2026, a significant gap opened between crypto and publicly listed companies related to the sector, signaling that the two markets are following different trajectories. According to a market review by Bitwise, cryptocurrencies fell by 36%, while stocks related to the crypto sector rose by 23% during the same period.

This divergence does not imply that stocks will continue to outperform tokens, but it clearly shows that the two groups are moving apart. For the market, it is a relevant signal: institutional investors seem to find in listed securities a more regulated and predictable exposure to the sector, while tokens remain subject to volatility linked to short-term speculative flows.

Importance of Verifiable On-Chain Metrics and Project-Level Analysis

The most credible metrics are those that cost something to produce and can be verified on-chain, not those that can be easily inflated. Brendan Ma, head of investment strategy at the Arbitrum Foundation, told CoinDesk that today analysts have a much stronger understanding of revenue composition, transactional activity, and the ability to capture value compared to a year ago.

Ma identified revenue from fees, users paying fees, and capital remaining on the network—including stablecoin reserves and tokenized assets—as indicators that are harder to manipulate. The number of active addresses and total value locked, on the other hand, can be inflated by incentives or bots. An increase in transactions becomes truly significant only if accompanied by higher fee revenues and greater user retention.

Case Study: Transaction Volume and Revenue Distribution of Arbitrum

Ma specifically cited Arbitrum as an example of this project-level analysis. The network has surpassed 2.7 billion lifetime transactions, with over 500 million occurring just in 2026, while Robinhood Chain generates approximately $40 million in annual revenue according to the foundation. As part of Arbitrum's expansion program, 10% of the net protocol revenue from that chain is returned to the Arbitrum ecosystem: a mechanism that directly ties network activity to the value redistributed to those who develop and use it.

Investment Products and Strategic Vision from Industry Leaders

Those who do not want to bet on individual projects can now rely on index products designed for broad exposure to the sector. Horsley explained that index products offer investors diversified exposure to crypto without the need to identify individual winners. Bitwise, the company led by Horsley, offers this type of instrument, as do other asset managers including 21Shares.

Grayscale's View on Bitcoin and Emerging Digital Assets

Zach Pandl, head of research at Grayscale, told CoinDesk that Bitcoin remains a macro asset linked to the demand for alternatives to fiat currencies, while other cryptocurrencies will face increasingly tight scrutiny over their underlying economics. According to Pandl, the outlook for the crypto sector is "very bright, because stablecoins, tokenized assets, and decentralized finance tools will drive demand for digital assets beyond Bitcoin in the coming years." "A small number of tokens with solid fundamentals will play a central role in the next chapter of digital assets," Pandl added. "Weaker projects with poor fundamentals will fall behind."

FAQ

Why are crypto investors moving away from market cap rankings?

Investors today prioritize fundamentals such as revenue, usage, and the ability to capture economic value, as they provide a more reliable indication of a token's long-term sustainability compared to simply ranking by market capitalization.

What role do perpetual futures play in crypto price movements?

Perpetual futures dominate daily price movements and determine short-term quotes, but it is the fundamentals that influence the survival and selection of tokens over 12-18 month horizons or longer.

How Has Institutional Involvement in Crypto Spot Trading Changed? {#How_Has_Institutional_Involvement_in_Crypto_Spot_Trading_Changed}

The share of institutional counterparts in Wintermute's OTC spot trading volume rose to 72% in the first half of 2026, up from 59% the previous year, indicating growing institutional participation.

What Are Credible On-Chain Metrics to Evaluate a Crypto Project? {#What_Are_Credible_On-Chain_Metrics_to_Evaluate_a_Crypto_Project}

The metrics considered most reliable are those that cost something to produce and can be verified on-chain, such as revenue from fees, users paying fees, and capital retention on the network.

Content created with the assistance of artificial intelligence and human editorial review.