Institutional Inflows, Not Retail FOMO, Were Behind Bitcoin’s May Rally: Bybit

Institutional investors, rather than retail traders, appear to have been the primary force behind Bitcoin’s sharp price rally in May 2025, according to a new asset allocation report released by top crypto exchange Bybit.

Bybit’s H1 2025 report shows that as of May, Bitcoin is still the biggest single asset held by all users — both institutional and retail — making up about 31% of their holdings.

According to the report, which looked at Bybit's active users, stablecoins like USDT and USDC make up an even larger share — around 33% for all users — which suggests investors might still be holding some cash on the sidelines, expecting prices could dip before they jump back in.

Bybit is currently the third-largest centralized crypto exchange in terms of 24-hour trading volumes, per data from CoinGecko.

Driving Force

The report also reveals that institutional traders slashed their stablecoin holdings by 14% between April and May, with an estimated 6% allocated to Bitcoin (BTC), 6% to Ethereum (ETH), and 1% to Solana (SOL). The move closely aligned with Bitcoin’s run to a new all-time high of $111,970 on May 22.

“Itʼs clear that institutions have deployed substantial capital in May 2025, which highlights their bullish view of Bitcoinʼs short-term price movements,” Bybit wrote in the report.

In contrast, retail investors were more cautious, reducing their stablecoin holdings by just 2% in May. Most of their reallocation went into Ethereum rather than Bitcoin, the report found.

For comparison, Bybit’s Q3 2024 data painted quite a different picture. Institutional investors significantly increased their stablecoin holdings during that period.

Per the report, in August 2024, investors were holding a much larger share in stablecoins — about 45.26% — at a time when Bitcoin was trading near $60,000. A few months later, by the end of the year, Bitcoin surged past the $100,000 mark.