Which Player is Leading as Bitcoin ETFs Break Inflow Records with $2.2B Investment?
Bitcoin ETFs had an extraordinary week, attracting a record-breaking $2.2 billion in investments and surpassing all other ETFs in the United States. This surge, which exceeded expectations, outpaced the inflows into any of the 3,400 ETFs available in the country.
Despite the rapid growth and appeal of Bitcoin ETFs, Vanguard remains dominant in the overall ETF market. Since the inception of Bitcoin ETFs, Vanguard has attracted an impressive $30 billion in inflows, a figure six times greater than the achievements of Bitcoin ETFs. This showcases Vanguard’s commitment to traditional finance and its prioritization of value-generating assets over speculative cryptocurrencies.
On the other hand, in the realm of Bitcoin ETFs, BlackRock’s iShares Bitcoin Trust (IBIT) leads the pack. During the week of February 12-18, IBIT attracted a substantial $1.6 billion in positive flows. Year-to-date, IBIT has amassed $5.2 billion, accounting for 50% of BlackRock’s total net ETF flows. BlackRock’s Bitcoin ETFs are described as the “TradFi Moby Dick,” outshining their competitors. A comparison of unrealized gains between IBIT and Invesco-Galaxy’s BTCO fund reveals distinct buying patterns and dollar-cost averaging strategies.
The recent surge in Bitcoin’s price, which has risen by 91% in the past four months, can be attributed to the U.S. SEC’s approval of spot Bitcoin ETFs on January 10. This approval has had a significant impact, with Bitcoin experiencing a nearly 7% climb during the week and trading at $52,100 at the time of writing.
While the growth of Bitcoin ETFs is impressive, challenges still exist. The Grayscale Bitcoin Trust, for example, experienced an outflow of $624 million from February 12-16. Despite these challenges, the continuous growth of Bitcoin ETFs is shaping the future of financial markets, with central banks also taking notice and trade groups urging the SEC to consider modifications for banks to serve as custodians of BTC funds.