Compiled by: Blockchain in Plain Language
A few years ago, Ethereum was seen as Bitcoin's 'little brother,' known for decentralized finance (DeFi), pixelated NFTs, and highly creative smart contract experiments, far from being a choice for 'serious' investors. However, by 2025, Ethereum has become the focus of Wall Street.
Goldman Sachs perfectly exemplified the traditional institution's mindset in 2021, when they dismissed Ethereum as 'too volatile and speculative' and labeled it a 'solution looking for a problem.' Their research team believed that smart contract technology was overhyped, with limited real-world applications, and that institutional clients had 'no legitimate use cases' for programmable money. They were not alone; JPMorgan referred to it as a 'pet rock,' and traditional asset management firms avoided it.
However, this view is as outdated as calling the internet a 'flash in the pan' back in the day. Today, Goldman Sachs is quietly building Ethereum-based trading infrastructure, JPMorgan is processing billions of dollars in transactions through its Ethereum-driven Onyx platform, and those asset management companies that once shunned Ethereum are now rolling out Ethereum-related products at breakneck speed.
The real turning point occurred in 2024 when the U.S. Securities and Exchange Commission (SEC) finally approved the Ethereum spot ETF. This may not sound like an exciting dinner table topic, but its implications are significant. Unlike Bitcoin, which is simply classified as 'digital gold,' Ethereum poses a conundrum for regulators: how to regulate a programmable blockchain that supports everything from decentralized exchanges to digital art markets? They ultimately resolved this issue and cleared the way, which signifies the direction of this industry's development.
The floodgates for ETFs have opened
For years, there has been skepticism about regulatory clarity around Ethereum, especially given the SEC's ambiguous stance on whether Ethereum qualifies as a security. However, the approval of the ETF marks an important signal: Ethereum has matured into an investable asset for pensions, asset management firms, and even conservative family offices.
BlackRock took the lead by launching the iShares Ethereum Trust; honestly, watching this release was like witnessing institutional investors' 'fear of missing out' (FOMO) unfold in real time. Fidelity followed closely, while Grayscale converted its existing products into ETFs, and suddenly, every major asset management company launched Ethereum products. But more notably, these products are not limited to standard ETFs tracking ETH prices; some also incorporate staking rewards, meaning institutional investors can earn returns through holdings like DeFi participants.
Enterprise embraces fully
What's truly captivating is how enterprises are incorporating Ethereum into actual business operations. This is not a speculative asset reserve like Bitcoin; rather, companies are building digital infrastructure on Ethereum because it solves real problems.
The real value of Ethereum for institutions lies in its infrastructure as a programmable blockchain capable of handling tokenized currencies, digital contracts, and complex financial workflows.
Institutions are rapidly joining this wave:
Franklin Templeton, a company managing $1.5 trillion in assets, has tokenized one of its mutual funds on Ethereum, allowing investors to hold digital shares on the blockchain and enjoy the benefits of transparency and around-the-clock settlement.
JPMorgan, through its blockchain division Onyx, is testing tokenized deposits and asset swaps using Ethereum-compatible networks like Polygon and their enterprise Ethereum Quorum.
Amazon AWS and Google Cloud now offer Ethereum node services, allowing businesses to easily access the network without building their own infrastructure.
Microsoft is collaborating with ConsenSys to explore enterprise use cases ranging from supply chain tracking to compliance smart contracts.
These are no longer just the domains of crypto-native players. Traditional financial giants are awakening to the fast, secure, and automated intermediary-free financial services that Ethereum offers.
Conversations among CFOs of Fortune 500 companies have completely changed. They are no longer questioning whether blockchain makes sense; instead, they are asking how to automate smart contract applications for vendor payments, supply chain financing, and internal processes as quickly as possible. The efficiency gains are evident.
The gaming and entertainment industries are particularly aggressive. Mainstream game studios are tokenizing in-game assets, music platforms are automating royalty distribution, and streaming services are experimenting with decentralized content monetization. Ethereum's transparency and programmability have almost overnight resolved decades-old issues in these sectors.
Why is Ethereum so attractive to institutions?
Ethereum allows assets (be it dollars, stocks, real estate, or carbon credits) to be digitized, tokenized, and programmed. Combined with stablecoins primarily operating on Ethereum (like USDC or USDT), you suddenly have the cornerstone to build a brand new financial operating system.
Need for cross-border instant settlement?
Need for contract milestone-based programmable payments?
Need transparency without losing control?
Ethereum can do it all, and more.
With Layer 2 solutions like Arbitrum and Optimism, these solutions expand Ethereum's capacity, lower costs, and significantly increase speed. Many institutions choose to build on Layer 2 networks to enhance efficiency while still benefiting from Ethereum's liquidity and security.
This entire institutional adoption hinges on the infrastructure layer that most people overlook. Companies like BTCS Inc are increasingly supporting the necessary infrastructure for traditional financial institutions to engage with Ethereum and products like ETH ETFs. BTCS focuses on operating secure, enterprise-grade Ethereum validation nodes, maintaining network integrity, and allowing institutions to participate in staking without dealing with technical complexities. While they are not custodians or ETF issuers, their validation node operations support Ethereum's functionality and credibility, enhancing the network resilience and transparency that institutional investors require.
Looking to the future
What are the future trends? I believe the direction is very clear. Ethereum is becoming the infrastructure layer for programmable finance. We're no longer just discussing cryptocurrency trading, but automated lending, programmable insurance, tokenized real estate, and supply chain financing operating around the clock.
Integration with Central Bank Digital Currencies (CBDCs) presents another huge opportunity. As countries formulate digital currency strategies, many are considering Ethereum-compatible solutions to enable seamless interaction between government-issued digital currencies and the broader DeFi ecosystem.
More importantly, this institutional embrace is driving the long-awaited regulatory clarity for the entire industry. When major financial institutions build products around Ethereum, regulators are strongly motivated to establish a viable framework rather than impose blanket restrictions.
We are witnessing a technology that started as an experimental platform gradually becoming a critical financial infrastructure. The approval of the ETF is significant, but it is just the beginning. The real story lies in how Ethereum fundamentally changes the way financial services operate, how businesses manage operations, and how value flows in the global economy.
Honestly, I think we are still in the early stages of this transformation. The current institutional adoption is just the beginning of the large-scale integration of programmable currencies with traditional finance.
