One of my main questions too. Will institutions come into the market and simply play with derivatives (so they can tell clients they do not hold "volatevil" crypto)? Or will they want to own the underlying asset so as to not be the odd man out should crypto moonshot?

My thinking right now is that they will short the market (once options come out later this year), buy the underlying asset on sale, and then look to flip at the top. Rinse and repeat. In this process, they will undoubtedly hold the underlying asset for longer term in case of a moonshot (and as a possible hedge to broad market decline). By doing so they will inevitably add more overall liquidity to the market which makes for more appreciation in the long run. What do you think? I plan to write a post about this very soon. Still structuring my thoughts.