The size of U.S. Bitcoin and Ethereum spot ETFs has reached $111 billion, but the average size of active crypto hedge funds is only $132 million, and 91% of funds are less than $1 billion. Binance Research pointed out that the key to institutional funds stuck in Beta exposure is not investment research capabilities, but the lack of institutional-level distribution layers and credible information verification. (Preliminary briefing: Weak non-farm payrolls and interest rate hike expectations have cooled! Wintermute: Crypto ETFs sucked in 1.1 billion magnesium, but BTC rose behind US stocks) (Background supplement: Non-farm payrolls defeated bulls in August! Bitcoin plummeted below 80,000 magnesium, Ethereum lost $2,500, and the entire network liquidated $220 million in one hour) Binance Research released a report stating that the scale of the U.S. Bitcoin and Ethereum spot ETFs has reached 111 billion US dollars, but the average size of active crypto hedge funds is only US$132 million, and 91% of funds are less than US$1 billion. Institutional funds are pouring into passive instruments, but they keep a distance from active strategies. The core bottleneck is not investment research capabilities, but the lack of institutional-level distribution layers and credible data verification. ETFs attracted 111 billion in funds, and the average active fund was only 132 million. Binance Research cited a joint survey by EY-Parthenon and Coinbase and pointed out that 73% of institutions plan to increase the proportion of digital asset allocation this year. A report by AIMA and PwC showed that 55% of traditional hedge funds already hold crypto assets, up from 47% in 2024. However, most of these demands go to passive investment vehicles, with 81% of the institutions surveyed preferring to obtain spot exposure through registered compliance products. U.S. Bitcoin and Ethereum spot ETFs had a combined asset size of approximately $111 billion as of the end of October 2026; by comparison, crypto hedge funds’ average AUM was only $132 million, and 91% of funds were under $1 billion. Binance Research believes that this differentiation reflects the gap in market infrastructure rather than the lack of managers’ capabilities. Neutral strategies took 92.1% of the funds, and directional strategies only allocated 6.7%. On the Capital Connect platform, directional strategy funds accounted for 44.3%, but only attracted 6.7% of the platform funds; market neutral, statistical arbitrage, and traditional financial style multi-strategy funds collectively controlled 92.1% of the asset management scale, of which multi-strategy funds alone accounted for 14.3%. The average single investment amount of the neutral strategy is approximately 11 times that of the directional strategy, indicating that capital allocators prefer certainty when raising bets. Binance Research pointed out that the flow of funds on the platform reflects the real preference of the allocator, rather than simply being determined by the number of funds. Investor participation in market-neutral strategies has climbed for two consecutive months, with a cumulative increase of 30% since May; participation in statistical arbitrage strategies has more than doubled over the same period and has remained stable throughout October. In October, BTC fell 7.2%, but directional funds still earned 1.9%. Bitcoin fell 7.2% in October, but directional funds still recorded an average positive return of +1.9% for the month, and the average return of market-neutral funds was +1.0%. The number of investors in directional strategies also rose to 52 in October, returning to May levels; the average return of directional funds since their establishment improved from -11% in June to +3.7% in October. However, the return distribution of directional strategies is extremely wide. The return range between the best and worst-performing funds is about 8 times that of the neutral strategy. The median return is about +4%. Only 55% of the funds achieved positive returns; in contrast, nine out of ten neutral strategy funds recorded positive returns. But the top quartile of directional funds have returned an average of +69% since inception, and allocators say they are still willing to pay as long as they can deliver this alpha with a controlled drawdown. 80% of allocators put asset safety first, and verifiability is the key. Binance Research directly interviewed the fund allocators and fund managers on the Capital Connect platform. 80% of allocators surveyed put asset security above historical performance and institutional reputation, and pointed out that verified internal exchange information can significantly enhance the credibility of due diligence. When they evaluate managers, they pay more attention to the ability to control drawdowns rather than simply high book returns. For fund managers, the real obstacle to fundraising is not that the rate of return is not impressive enough, but the cost of trust. Past performance is difficult to cross-verify, and issues such as KYC, anti-money laundering, and counterparty compliance review are superimposed, which seriously slows down the pace of fundraising, resulting in the vast majority of funds having to rely on recommendations from acquaintances. After the platform was listed, some managers have been able to reach a wider group of investors, compliance agencies and a pool of small funds. Related reports: The craziest IPO in US stock market history! SpaceX's listing attracted more than $70 billion in retail investor orders, nearly filling the world's total funds raised. The world is going crazy on U.S. stocks! Kobeissi warns: The influx of foreign capital "breaks the 20-year historical record." How long can the AI ​​craze last? SharpLink bought 39,000 ETH in three days, and increased its investment in Ethereum after a lapse of 8 months. Bitcoin and Ethereum ETFs bought 111 billion U.S. dollars. Why can’t active crypto funds get institutional money? 〉This article was first published in DongZu BlockTempo "DongZu DongTen - the most influential blockchain news media".