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US Bitcoin ETFs Post Longest Run of Inflows as Token Nears Record

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US Bitcoin ETFs Post Longest Run of Inflows as Token Nears Record


(Bloomberg) — US exchange-traded funds investing directly in Bitcoin attracted net inflows for an unprecedented 18th straight day, a spurt of demand that has helped to lift the largest digital asset toward a record high.

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Net subscriptions for the group of almost a dozen products stood at $15.6 billion through Thursday following a Jan. 11 launch, taking total assets to $62.3 billion, according to data compiled by Bloomberg.

The Bitcoin funds from the likes of BlackRock Inc. and Fidelity Investments rank as some of the most successful debuts in the ETF sector’s history. They took Wall Street by storm, tilting crypto’s center of gravity to the US from Asia.

Many speculators in the options market anticipate that Bitcoin this month will surpass March’s all-time peak of $73,798, aided by ETF demand and expectations that Federal Reserve interest-rate cuts lie ahead.

“There have been massive inflows into spot-Bitcoin ETFs,” Sean Farrell, head of digital-asset strategy at Fundstrat Global Advisors LLC, wrote in a note. “Macro continues to trend in crypto’s favor, with economic growth slower at a non-recessionary pace and signs of disinflation continuing.”

Last week, BlackRock’s $21.4 billion iShares Bitcoin Trust became the world’s largest fund for the token, vaulting past Grayscale Investments LLC’s $20.1 billion Bitcoin trust. The $12.3 billion Fidelity Wise Origin Bitcoin Fund is in third spot.

SEC Pivot

The US Securities and Exchange Commission grudgingly allowed spot-Bitcoin ETFs in January in the wake of a court reversal in 2023. The agency in May also surprisingly pivoted toward approval of funds for No. 2 token Ether.

The SEC under Chair Gary Gensler is otherwise critical of the digital-asset industry’s alleged noncompliance with regulations. Congressional efforts to bring some legislative clarity for crypto have picked up pace of late.

Ophelia Snyder, president of crypto ETF provider 21 Shares AG, said adoption of digital-asset funds remains in its infancy for institutions and intermediaries. “The market has quite a way to run and we’re still in quite early innings,” she said on an episode of Bloomberg’s Tiger Money podcast that airs Tuesday.

Bitcoin has more than quadrupled since the start of last year. The surge has dulled memories of a painful bear market in 2022 that revealed frauds and led to the jailing of once feted entrepreneurs like Sam Bankman-Fried.

Bitcoin was steady at about $71,100 as of 12:35 p.m. Friday in Singapore, while Ether was little changed at $3,810.

–With assistance from Rebecca Sin and David Ingles.

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©2024 Bloomberg L.P.



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