$2 Trillion in Capital Moves Into Bitcoin as Crypto Overtakes Traditional Finance

▲ Virtual assets

The virtual asset market is reaching a historic turning point as massive institutional capital inflows and evolving regulations push it into the core of the traditional financial system.

On February 17 (local time), cryptocurrency-focused media outlet BeInCrypto reported key highlights from the Consensus Hong Kong 2026 conference, noting that global asset managers such as BlackRock are accelerating efforts to include virtual assets as essential components of investment portfolios. Nicholas Peach, Head of iShares Asia Pacific at BlackRock, projected that if just 1% of Asia’s $108 trillion in household assets were allocated to virtual assets such as Bitcoin (BTC), approximately $2 trillion would flow into the market. BlackRock’s spot Bitcoin ETF, iBIT, has already secured $53 billion in assets, becoming the fastest-growing ETF in history.

Asia has demonstrated remarkable progress in building financial infrastructure to attract institutional capital. The Singapore Exchange (SGX Group) reported that cumulative trading volume of its cryptocurrency perpetual futures products, launched last November, surpassed $2 billion within two months, proving strong institutional demand. Laurent Poirot, Head of Derivatives Strategy and Development at SGX Group, stated that more than 60% of total trading occurred during Asian trading hours and that institutions are strongly calling for further development of futures and options markets for major assets such as Ethereum (ETH). Major Japanese banks are also developing stablecoin solutions to establish regulated channels for the safe movement of traditional capital.

For traditional financial institutions to firmly establish themselves in the virtual asset market, reporting systems and regulatory compliance compatible with existing financial frameworks are essential. Louis Rosher of Zodia Custody, backed by Standard Chartered, pointed out that banking executives still question the credibility of crypto firms and prefer traditional daily statements and audit trail systems over blockchain explorers. Samuel Chong of Lido emphasized that protocol security and regulatory alignment are prerequisites for institutional participation.

Changes in the U.S. regulatory environment are viewed as a key variable determining the pace of institutional capital inflows. Anthony Scaramucci, founder of SkyBridge Capital, referenced the potential passage of the U.S. cryptocurrency market structure bill (CLARITY Act), analyzing that large-scale institutional allocation will occur once regulatory clarity is secured. However, the personal crypto-related business activities of former President Donald Trump and his associates have introduced complexities into the legislative process. Meanwhile, Hong Kong and Singapore appear to be moving ahead of the United States by swiftly establishing regulatory frameworks that institutions can practically utilize.

The virtual asset ecosystem is now evolving beyond a speculative market into the infrastructure of a digital capital market serving 5.5 billion internet users worldwide. Richard Teng, Co-CEO of Binance, emphasized that while retail investor demand has slowed, allocations by corporations and institutions with “smart money” remain strong. As of mid-2025, institutional virtual asset trading volume in Asia reached $2.3 trillion, marking a 70% year-on-year increase, signaling the dawn of an era in which virtual assets are becoming a new standard in traditional finance.

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