The race between crypto exchange-traded products (ETP) and traditional growth-focused ETFs is turning increasingly one-sided, according to a new mid-year report from crypto asset manager 21Shares.
While institutional adoption of digital assets continues to advance, crypto ETPs remain far from catching the tech-fueled momentum that has propelled the Nasdaq-100 and its ETF proxies to new heights.
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At the start of 2026, 21Shares predicted that global crypto ETP assets under management would surpass $400 billion and eventually overtake the asset base of the Invesco QQQ Trust (NASDAQ:QQQ).
Instead, the opposite has happened.
Global crypto ETP assets stood at roughly $140 billion as of May 2026, down about 15% year-to-date. Bitcoin ETPs accounted for around $110 billion of that total. Meanwhile, QQQ has continued benefiting from investor enthusiasm around artificial intelligence and technology, with assets approaching the half-trillion-dollar mark.
The report argues that the structural drivers behind crypto adoption remain intact, including growing institutional participation, expanding ETF access, and improving regulatory clarity. However, crypto ETP growth remains heavily tied to Bitcoin’s (CRYPTO: BTC) price performance, making it difficult to close the gap with technology-focused funds during periods of market weakness.
AI Stocks Continue To Attract Investor Capital
The report points to another challenge facing crypto-linked investment products: competition from AI-driven equities.
In its section on regulated token sales, 21Shares noted that investor capital has increasingly flowed toward AI, robotics and space-related stocks, reducing appetite for speculative crypto investments. The firm said the biggest obstacle facing regulated token offerings has not been regulation but opportunity cost, as public-market AI and technology names have delivered outsized returns that attracted risk capital away from digital asset projects.
That trend has benefited some of the market’s biggest AI winners, including NVIDIA Corp (NASDAQ:NVDA), Microsoft Corp (NASDAQ:MSFT), Broadcom, Inc (NASDAQ:AVGO), Palantir Technologies Inc (NASDAQ:PLTR), Advanced Micro Devices (NASDAQ:AMD) and Oracle Corp (NYSE:ORCL).
Collectively, these companies have become core holdings across many of the fastest-growing AI-focused ETFs, Roundhill Magnificent Seven ETF (BATS:MAGS) has has significant exposure to Microsoft and Nvidia, while Global X Artificial Intelligence & Technology ETF (NASDAQ:AIQ) and Defiance Quantum ETF (NASDAQ:QTUM) count several AI beneficiaries, including Nvidia, Microsoft, Broadcom, Oracle and AMD, among their top holdings.
That trend has implications for ETFs as well. Funds tracking the Nasdaq-100 and other AI-heavy indexes have become major beneficiaries of investor demand for exposure to artificial intelligence infrastructure, semiconductors, cloud computing and robotics.
Crypto funds, by contrast, have struggled to attract comparable inflows amid weaker digital asset prices.
Crypto ETFs Show Signs Of Resilience
Despite lagging AI-focused funds, crypto ETFs are showing evidence of investor commitment.
U.S. spot Bitcoin ETFs have experienced roughly $3 billion in net outflows this year, yet their aggregate Bitcoin holdings remain near record levels at more than 1.25 million Bitcoin. The report suggests investors are holding positions through volatility rather than exiting the asset class altogether.
The firm also highlighted continued product innovation across the industry, including new spot ETF launches beyond Bitcoin and Ethereum, such as spot Hyperliquid ETFs (the report notes they attracted more than $150 million in net inflows in less than a month); Morgan Stanley‘s entry into the spot Bitcoin ETF market and efforts by major issuers to bring options-based Bitcoin income ETFs to investors.
For now, while crypto ETFs continue to mature, AI-powered equity funds are attracting a larger share of investor capital, leaving the crypto industry’s once-ambitious goal of rivaling QQQ looking more like a story for a future market cycle than the current one.
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