- Retail investors are using the market downturn as a chance to diversify beyond Bitcoin and Ether, according to Robinhood.
- Institutional investors are taking “baby steps,” focusing more on large block trades in top-tier assets than on riskier altcoins or DeFi.
- Despite a prevailing market sentiment of “Extreme Fear,” crypto holders are increasingly engaging in activities like staking and exploring on-chain use cases.
As the crypto market downturn persists throughout February, retail investors on the Robinhood platform are increasingly viewing it as a buying opportunity to diversify their portfolios. According to the firm’s head of crypto, Johann Kerbrat, customers are actively exploring assets far beyond the top few cryptocurrencies.
“We actually see a lot of customers continuing to trade crypto and diversifying, not just on the top two or three assets, but actually going pretty wide,” Kerbrat told Cointelegraph in an exclusive interview. This suggests a growing comfort with crypto’s inherent volatility as an established asset class. However, the broader market mood remains cautious, with the Crypto Fear & Greed Index stuck in “Extreme Fear.”
Consequently, this retail diversification contrasts with a lingering institutional hesitation about what constitutes the third major crypto asset after Bitcoin and Ethereum. Coinbase Asset Management president Anthony Bassili noted in November that Solana is “maybe” the next candidate on investors’ radars. Meanwhile, institutional platform MidChains CEO Basil Al Askari observed that large asset managers are entering with block trades into “predominantly the top 20 assets.”
“It’s baby steps,” Al Askari said, clarifying that this activity is not yet flowing into smaller altcoins or DeFi yield products. On the retail front, however, crypto ownership is becoming more active, as staking on Robinhood has gained strong traction. Kerbrat expressed surprise at seeing more holders explore DeFi despite ongoing market uncertainty.
This unfolding dynamic occurs against a backdrop of significant capital outflow from U.S. spot Bitcoin ETFs, which have seen roughly $3.8 billion in net withdrawals over five consecutive weeks. Data from CoinMarketCap also shows that the Altcoin Season Index recently scored a Bitcoin Season rating of just 33 out of 100, indicating a persistent preference for the flagship cryptocurrency over altcoins.
✅ Follow BITNEWSBOT on Telegram, Facebook, LinkedIn, X.com, and Google News for instant updates.
