ABU DHABI / LONDON (IT BOLTWISE) – Investors from the oil-rich Gulf region are playing an increasingly important role in the Bitcoin market. By using capital from government funds and private networks, the liquidity of the crypto market is strengthened. This development could permanently change the market structure of Bitcoin.
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Since Bitcoin’s first boom in 2013, highly speculative retail activity and trading on less regulated platforms have driven major price increases. But with the launch of the first US Bitcoin ETF, the ProShares Bitcoin Strategy ETF (BITO), on October 19, 2021, Bitcoin increasingly became the focus of institutional investors. In 2025, a new source of capital came to the fore: oil-linked funds from the Gulf region. These include sovereign wealth funds, government-affiliated investment firms, family offices and the private banking networks that serve them.
These pools of capital enter the market through regulated channels, particularly spot Bitcoin ETFs. These inflows could fuel the next wave of liquidity. Rather than just causing temporary price increases, they could support tighter bid-ask spreads, greater market depth and the ability to execute larger trades with less price impact. The article examines how investors tied to the oil economy could impact crypto market liquidity, outlines what the next wave of liquidity might look like, and explains why these funds are interested in Bitcoin.
The term “oil-rich investors” refers to a network of capital managers whose resources are directly or indirectly tied to hydrocarbon revenues. Not only the size of these allocations is crucial for liquidity, but also how they are used. Many of these positions are transacted through vehicles and platforms designed for institutional participation and can support a more robust market structure. Spot Bitcoin ETFs do not hold futures contracts, but rather Bitcoin in custody. This means that net inflows typically require purchases of BTC on the spot market, linking investor demand more directly to spot liquidity than to derivatives-based exposures.
A key difference from previous cycles is the maturation of the market infrastructure. Spot Bitcoin ETFs offer a familiar, regulated vehicle for traditional investors. At the same time, prime brokerage services, institutional custody, and regulated trading centers have reduced operational friction for large-scale allocations. Authorized participants, not the ETF issuers, typically handle the buying and selling of Bitcoin associated with ETF flows. These large financial firms create and redeem ETF shares and can hedge through spot and derivatives markets, which influences daily liquidity behind the scenes.
Spot Bitcoin ETFs are a straightforward route for this type of capital. The structure and risk profile of crypto ETFs, such as BlackRock’s iShares Bitcoin Trust (IBIT), differ from traditional registered funds. For investors focused on governance and compliance, these differences may be important. In the third quarter of 2025, the Abu Dhabi Investment Council increased its Bitcoin exposure by increasing its position in IBIT. A regulatory filing shows the fund had increased its stake from about 2.4 million to nearly 8 million shares as of Sept. 30, with the position worth about $518 million at quarter end.
These numbers suggest that Gulf-based capital is gaining Bitcoin exposure via US-regulated listings. Even when implemented through a simple ETF purchase, such inflows can support liquidity as market makers and authorized participants may hedge their exposure via spot and derivatives markets as flows change. There are several overlapping reasons why oil-rich investors are interested in Bitcoin. Many spot Bitcoin ETFs use multiple custodians and layers of insurance. This facility reflects institutional risk management standards and reassures conservative investors who would never hold private keys themselves.
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