Institutional crypto adoption is accelerating as Tether expands its Bitcoin holdings, miners shift toward AI operations and Polymarket joins Nasdaq amid $1 billion in fund outflows.
Institutional adoption continued to reshape the digital asset market this week, even as investors were reminded by geopolitical tensions that crypto remains sensitive to broader macroeconomic conditions.
Digital asset funds recorded more than $1 billion in outflows as risk exposure was reduced by traders amid fading hopes for a lasting ceasefire between the United States and Iran. At the same time, Tether strengthened its control over Twenty One Capital, while Bernstein argued that Artificial Intelligence infrastructure development is creating a strategic role for Bitcoin miners. Meanwhile, Polymarket partnered with Nasdaq to launch prediction markets linked to private companies.
This week’s Crypto Biz highlights how the digital asset ecosystem continues to be shaped by institutional influence.
Crypto Funds See $1 Billion Outflows Amid Geopolitical Risk-Off Sentiment
Digital asset investment products recorded more than $1 billion in outflows last week as investors moved to the sidelines amid escalating tensions in the Middle East.
According to data from CoinShares, the withdrawals represented one of the biggest weekly reversals recorded so far this year, with Bitcoin and Ether products making up most of the redemptions. The sell-off occurred as hopes for a lasting ceasefire between the United States and Iran were scaled back by markets, triggering a broader retreat from risk assets despite Bitcoin’s reputation as a macro hedge.
The pullback highlights how rapidly sentiment can change when geopolitical shocks impact global markets. Institutional demand for crypto remains structurally stronger than in previous market cycles, but the latest outflows suggest digital assets are still being treated by allocators as part of the broader risk-on complex during periods of elevated volatility.
Tether Expands Bitcoin Treasury Strategy Through SoftBank-Backed Twenty One
Tether has acquired SoftBank’s stake in Twenty One Capital, strengthening its control over one of the crypto industry’s largest corporate Bitcoin vehicles.
The stablecoin issuer acquired the Japanese conglomerate’s roughly 26% stake in the company for an undisclosed amount as Twenty One Capital prepares to expand beyond Bitcoin accumulation into Bitcoin-related financial services. Led by Jack Mallers, Twenty One was launched with backing from Tether, Bitfinex, Cantor Fitzgerald and SoftBank, and more than 42,000 BTC has been accumulated on its balance sheet.
The transaction further strengthens Tether’s influence over the company as institutional demand for Bitcoin treasury exposure continues to expand.
Bernstein Says Bitcoin Miners Are Emerging as Key Players in the AI Race
Bitcoin miners are increasingly being viewed as valuable infrastructure partners by artificial intelligence developers, giving these firms a longer runway to diversify into data centers and high-performance computing, according to research from Bernstein.
Analysts at Bernstein said Bitcoin miners possess two increasingly scarce resources amid the AI boom: large-scale power access and data center capacity. Portions of that infrastructure, originally built for energy-intensive Bitcoin mining, are now being repurposed by companies to host high-performance computing workloads for AI clients.
Bernstein argued that the shift could unlock new revenue streams and boost valuations for Bitcoin miners, particularly as block rewards become less profitable after each Bitcoin halving cycle. The convergence of crypto and AI is transforming what were once cyclical commodity businesses into strategic infrastructure plays linked to two of the market’s most capital-intensive industries.
Polymarket Teams Up With Nasdaq to Expand Prediction Markets Into Private Firms
A prediction market category has been launched through a partnership between Polymarket and Nasdaq, allowing users to forecast future valuations of private, pre-IPO companies.
Participants will be allowed through the initiative to trade on private-company milestones, including valuation targets, IPO timing and secondary market activity. By expanding beyond elections and macro events, the partnership is pushing prediction markets further into the domain of venture capital and startup investing.
The collaboration is also being seen as a sign that institutions are increasingly warming to event-based forecasting. For crypto-native platforms such as Polymarket, partnerships with established financial infrastructure providers could help prediction markets be further legitimized as an alternative tool for price discovery and investor sentiment analysis.
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