On the second day of the Solana Breakpoint 2025 event held in Abu Dhabi, UAE, AltCoinDesk spoke with Danny Nelson, Research Analyst at Bitwise Asset Management, a leading crypto index fund manager.
The conversation revolved around the institutional appetite for cryptocurrencies, the significance of the ETH/BTC ratio, major red flags associated with token launches, and more.
As institutional interest in the digital assets industry continues to grow, Nelson offers a fresh perspective on the movement of capital flow. He also highlights some underreported developments in the industry that can become part of the mainstream conversation in 2026.
Institutional access to digital assets a game-changer
The past few years suggest that there has been a dramatic shift in institutional investors’ stance toward digital assets, especially since US President Donald Trump took the reins following his victory in the November 2024 elections. However, Nelson says that it’s not the change in sentiment as much as it is easier access.
Nelson emphasized that it is becoming increasingly easier to get exposure to digital asset investment products in the US. He referred to Bitwise’s recent Solana staking exchange-traded fund (ETF), which has attracted almost $600 million in inflows despite the recent market downturn.
He added that although the launch of Bitcoin and Ethereum ETFs was pivotal, the real value unlock lies in institutions’ ability to gain exposure to the long tail of digital assets through similar, regulated financial products.
Is capital rotating into altcoins?
From a research perspective, Nelson described the current market as “tough to read.” While veteran investors tend to place importance on signals like a rising ETH/BTC ratio and rising decentralized finance (DeFi) adoption metrics, he stated that the top digital asset still dictates everything.
Everything is basically waiting for Bitcoin. As soon as Bitcoin comes back, that gives permission for what people call altcoin season.
Source: Danny Nelson, Research Analyst, Bitwise Asset Management
According to data from DefiLlama, the total value locked in the Ethereum DeFi ecosystem currently hovers around $68. For comparison, the value was around $66 billion in January 2025.
Red flags in token launches
When asked what are the red flags he looks for while evaluating new token launches, Nelson remarked that risk awareness should be prioritized over hype. He added that decentralization isn’t just about rigid frameworks but rather about removing single points of failure.
Nelson referred to Terra Luna’s spectacular collapse in May 2022, which wiped out almost $45 billion in market cap in just one week. The Bitwise Research Analyst stated that Terra’s end is a cautionary tale, in that just because a project has a high market cap, it doesn’t make it’s necessarily sustainable.
We didn’t understand where the yield was coming from. It didn’t smell right. Just because something is ripping doesn’t mean you should get involved.
Source: Danny Nelson, Research Analyst, Bitwise Asset Management
Proprietary AMMs could be the next big thing
Nelson said that not a lot of people have been talking about the usefulness of proprietary automated market makers (AMMs). However, it has been a frequent topic of discussion at the Solana Breakpoint event.
To explain, proprietary AMMs are geared toward institutional liquidity providers, allowing tighter spreads, customized pricing curves, and controlled access, unlike typical AMMs like Uniswap that use open, fixed formulas and permissionless liquidity.
He gave the example of stable swaps on Solana and other platforms where proprietary AMMs are allowing people to trade tokens while providing spreads that are even tighter than they could get on Coinbase or Binance.
