Bitcoin ETF Dominates Global ETF Market With $17.5B Influx, Bitwise CIO Says

Bitcoin ETFs are rising because the fastest-growing ETFs, attracting important consideration from institutional traders.

Since launching in January 2024, these ETFs have pulled in a exceptional $17.5 billion in web flows, outpacing the earlier file held by the Nasdaq-100 QQQs, which gathered roughly $5 billion of their first yr.

Bitcoin ETF Dominates World ETF Market With $17.5B Inflow

Bitcoin ETFs have seen a record-setting tempo in adoption, particularly amongst institutional traders. Matt Hougan, CIO of Bitwise, highlighted in a current X thread that they’ve drawn the fastest-growing inflows of all time. The $17.5 billion inflow since their launch marks a big milestone, surpassing the earlier file held by the Nasdaq-100 QQQs by a large margin.

This fast progress is especially noteworthy given the continuing skepticism from some market individuals who declare that institutional adoption is minimal.

1/ Bitcoin ETFs are being adopted by institutional traders sooner than some other ETF in historical past. Do not imagine the “it is simply retail” story. The information show in any other case.

A thread.

— Matt Hougan (@Matt_Hougan) August 21, 2024

One of many most important arguments towards the success of those ETFs has been the notion that they’re primarily pushed by retail traders, with minimal institutional participation. Critics level to 13F filings, which present that as of Q2 2024, establishments maintain solely 21% of the present BTC ETF property beneath administration (AUM), whereas retail traders account for the remaining 79%.

Nonetheless, Hougan’s evaluation challenges this narrative by evaluating them to the ten fastest-growing new ETFs in historical past. His findings reveal that the previous are main in institutional adoption, whether or not measured by the variety of establishments or the whole AUM.

Nasdaq-100 QQQs Institutional Adoption

Hougan additionally in contrast the institutional adoption of BTC ETFs to that of the Nasdaq-100 QQQs, the earlier record-holder for ETF inflows. Whereas direct comparisons are difficult because of variations within the time intervals and availability of historic information, Hougan notes Bitcoin ETFs have attracted 3 times the variety of institutional holders inside the first two quarters in comparison with the QQQs throughout an analogous timeframe.

This implies that institutional curiosity in them isn’t solely current however can be rising at an unprecedented price.

World ETF flows are at $911b YTD, a close to lock to interrupt their ann file of $1.2T because of extra contrib from non-US international locations who’re including near 40% of complete vs 25% in 2021. Additionally, there’s been 1,121 ETFs launched globally this yr, which can be file tempo. pic.twitter.com/3BIVaHd1Kx

— Eric Balchunas (@EricBalchunas) August 21, 2024

Concurrently, the expansion of BTC ETFs is a part of a broader development within the world ETF market, which has seen record-breaking inflows in 2024. Eric Balchunas, a Bloomberg ETF analyst, identified that world ETF flows have reached $911 billion year-to-date, with these ETFs being a big contributor to this surge.

Notably, BlackRock’s IBIT secured the third spot amongst world issuers by way of year-to-date inflow.

Bitcoin Worth Outlook

Subsequently, the rise of Bitcoin ETFs has additionally coincided with broader tendencies within the cryptocurrency market. Analysts have famous a potential “short squeeze” in Bitcoin derivatives, which may result in a pointy rally in BTC costs.

The restoration within the Worry and Greed Index and continued inflows into these ETFs recommend a constructive market sentiment, regardless of ongoing macroeconomic and political uncertainties in the USA.

In the meantime, at press time, Bitcoin price had recovered and was buying and selling at $60,012, a 1.80% surge from the intra-day low.