Crypto for Advisors: Beyond bitcoin and ether

Happy Thursday, advisors!

In today’s newsletter, Glenn Williams Jr, from ProShares,explains why investors are looking beyond bitcoin and ether to manage concentration risk using multi-asset indices.

Then, in “Ask an Expert,” we examine key institutional trends and the growing preference for spot ETFs.

Happy reading.

The cryptocurrency market is growing rapidly, with new technologies and networks emerging throughout the ecosystem every day. While bitcoin and ether remain the most widely known crypto assets, they represent just two among thousands of other cryptocurrencies. As of the time of writing TradingView puts the total crypto market cap at roughly $2.5 trillion, spanning a wide range of uses and applications across the crypto ecosystem. For investors seeking exposure to this evolving asset class, focusing on one or a few cryptocurrencies can mean missing opportunities across the broader market.

That distinction has become increasingly important as the crypto market matures. Bitcoin has largely established itself as the market’s primary store-of-value asset, while ether remains closely associated with smart contracts and decentralized applications. Beyond those two assets, however, networks have emerged targeting everything from faster transaction settlement and decentralized finance to interoperability, data infrastructure and other applications. Put differently, the crypto market is increasingly becoming a collection of different technologies and use cases rather than simply a collection of alternatives to bitcoin.

Those differences also mean that market leadership can change over time. As we have seen during previous crypto cycles, periods dominated by bitcoin performance can eventually give way to broader participation across the asset class. That does not necessarily mean that smaller cryptocurrencies will outperform bitcoin or ether. It does, however, mean that a portfolio concentrated in the two largest assets may have limited exposure if investor interest broadens elsewhere.

How a multi-asset index addresses concentration in crypto

The CoinDesk 20 Index was designed to provide diversified exposure to the crypto asset class through a rules-based index of 20 of the largest and most liquid cryptocurrencies. The index excludes memecoins, stablecoins and certain other crypto assets and it reconstitutes quarterly to capture changes in the market.

Importantly, the index is designed not only to provide broader exposure across the crypto market, but also to limit concentration in its largest assets. Bitcoin and ether represent a large share of total crypto market capitalization, meaning a traditional market-cap-weighted index would be dominated by those two assets.

The CoinDesk 20 Index addresses that concentration through a modified market capitalization weighting methodology. The index applies:

· 30% cap on the largest constituent

· 20% cap on all other constituents

These caps limit concentration in a single crypto asset and allow other major cryptocurrencies to play a larger role in the index.

Left: Source: CoinDesk, as of June 30, 2026. Right: ProShares hypothetical calculation using the CoinDesk 20 Index constituents, weighted by market capitalization without the index caps, as of June 30, 2026. For illustrative purposes only.

Without these caps, the index would largely reflect the performance of bitcoin and ether alone. By limiting concentration in the largest assets, the CoinDesk 20 Index creates more balanced exposure across a wider set of cryptocurrencies.

There is also a practical consideration. Building similar exposure directly would require an investor to purchase, custody and periodically rebalance a relatively large number of individual crypto assets. The infrastructure surrounding crypto custody has improved considerably, but holding multiple cryptocurrencies can still require navigating different exchanges, wallets, custody arrangements and operational considerations. An index-based approach can simplify that process while maintaining exposure to changes occurring across the broader market.

The regulatory environment surrounding digital assets continues to evolve, with policymakers and regulators working toward clearer rules governing how crypto assets are issued, traded and held. Greater regulatory clarity could ultimately make it easier for additional parts of the crypto ecosystem to develop within traditional financial markets.

That evolution matters because the next stage of crypto adoption may not necessarily look like the last one. Bitcoin and ether could remain the market’s largest assets while new networks and applications develop alongside them. It is difficult to know in advance which technologies will ultimately gain the greatest adoption, making diversification one way to gain exposure without having to identify those future leaders in advance.

Looking beyond bitcoin and ether does not mean leaving them behind. The CoinDesk 20 Index still maintains large positions in both bitcoin and ether while providing exposure to the broader crypto market.

– Glenn Williams Jr., crypto markets analyst, ProShares

Bitcoin is only the beginning. Among over 20,000 actively tracked and traded cryptocurrencies, bitcoin now accounts for a dominance of approximately 60%. Diversification is key for institutional investors to manage volatility and capture broader opportunities. Indices can be an efficient way of tracking asset class performance, while products like exchange-traded funds (ETFs) and separately managed accounts (SMAs) can provide exposure to multiple cryptocurrencies at once.

What institutional investor trends are you seeing in digital assets?

Institutional investors are entering the market, pushing digital assets from a niche investment into a key asset class. EY-Parthenon and Coinbase conducted a 2026 survey of more than 350 institutional investors. Of the investors surveyed, almost three-quarters (73%) planned to increase their crypto allocations in 2026, and 74% of investors expected crypto prices to rise over the next 12 months. The survey also showed that regulated products have become the default entry point for institutional crypto exposure. Two-thirds (66%) of respondents already hold spot crypto ETFs and ETPs, and 81% said they prefer accessing spot crypto through a registered vehicle.

What broad-based benchmarks exist in crypto?

There are a lot of multi-asset indices forming for crypto. As mentioned by ProShares, the CoinDesk 20 Index captures the performance of top digital assets and the CoinDesk 5 Index tracks the performance of the five largest constituents of the CoinDesk 20. CoinDesk 20 was designed for liquidity, and is available in 20 investment vehicles globally including the ProShares CoinDesk 20 Crypto ETF (KRYP) and the WisdomTree Physical CoinDesk 20 ETP (WCRP). CoinDesk 5 underlies the first U.S. multi-crypto ETP, the Grayscale CoinDesk Crypto 5 ETF (GDLC). CoinDesk Data & Indices also offers the CoinDesk 80, CoinDesk 100, CoinDesk Memecoin Index and hundreds of BMR-compliant indices to measure, invest and trade in the ever-expanding crypto universe.

– Kim Klemballa, CoinDesk Data & Indices

• The CLARITY Act fails to advance in the Senate, falling short of the 60 votes needed to move forward.
• Canada’s bank regulator Office of the Superintendent of Financial Institutions (OSFI) declares that tokenized deposits follow the same rules as traditional deposits.
• The UK House of Lords passes an amendment requiring the Treasury to publish a national digital asset strategy within 12 months covering crypto, stablecoins and tokenized securities.

Looking for more? Receive the latest crypto news from coindesk.com and market updates from coindesk.com/institutions.

This information is not meant to be investment advice. Any forward-looking statements herein are based on expectations of ProShare Advisors LLC at this time. Whether or not actual results and developments will conform to ProShare Advisors LLC’s expectations and predictions, however, is subject to a number of risks and uncertainties, including general economic, market and business conditions; changes in laws or regulations or other actions made by governmental authorities or regulatory bodies; and other world economic and political developments. ProShare Advisors LLC undertakes no duty to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Investing involves risk, including the possible loss of principal.