More than 100 cryptocurrency exchange-traded products (ETPs) are expected to launch in 2026, but a significant portion of them may fail to survive due to weak investor demand, according to a leading ETF analyst.
Bloomberg Intelligence analyst James Seyffart said he agrees with a recent prediction from crypto asset manager Bitwise that the coming year will see an explosion of new crypto-linked ETFs and ETPs.
However, Seyffart warned that many of these products are unlikely to gain enough traction to remain viable in the long term.
“We’re going to see a lot of liquidations in crypto ETP products,” Seyffart said on Wednesday. “That might happen at the tail end of 2026, but it’s more likely by the end of 2027.”
Seyffart noted that issuers are aggressively filing new products with U.S. regulators, with at least 126 crypto ETP applications currently awaiting decisions from the Securities and Exchange Commission.
The surge reflects growing confidence among asset managers following the approval and success of spot Bitcoin ETFs earlier this year, which attracted billions of dollars in inflows.
However, analysts caution that not all crypto ETPs will benefit from the same level of investor interest. While Bitcoin and, to a lesser extent, Ether products have demonstrated strong demand, more niche offerings tied to alternative tokens, thematic strategies, or complex derivatives may struggle to attract assets under management.
ETF closures are common across traditional markets when products fail to reach critical mass, and crypto-linked ETPs are expected to follow a similar pattern.
Products with low trading volumes often face high operational costs, making them economically unsustainable for issuers.
Bitwise’s forecast suggests that asset managers are currently “throwing products at the wall” in hopes of capturing market share in a rapidly evolving regulatory environment. But Seyffart emphasized that market forces will ultimately determine which offerings survive.
As competition intensifies, investors are likely to gravitate toward highly liquid, low-cost products with clear exposure to major digital assets.
Analysts say the coming years could see a wave of consolidation, leaving only a handful of dominant crypto ETPs after the initial surge fades.
For now, the crypto ETF race continues, but longevity may prove just as challenging as regulatory approval.