The U.S. Securities and Exchange Commission (SEC) greenlit Bitcoin Exchange Traded Funds (ETFs) in early January. With 50 days elapsed, we’re diving into the numbers to understand their performance. Has the Bitcoin ETFs so far been a success?
Overview
In a nutshell: absolutely! By March 25, all Bitcoin ETFs boast have collected $53 billion in assets under management (AUM). Breaking down the frontrunners:
- Grayscale’s GBTC holds $23 billion.
- Blackrock’s IBIT has amassed $15 billion.
- Fidelity’s FBTC rounds it out with $9 billion.
For context, GBTC ranks within the top 100 of all ETFs, and IBIT is on the brink of joining this elite group. To draw a parallel, Gold ETFs hold about $200 billion in AUM.
Five Key Metrics Painting the Picture for Bitcoin ETFs:
- IBIT and FBTC set the record as the top two ETFs in AUM growth within their first 50 days (Source).
- Both ETFs experienced unbroken positive inflows daily for 50 days—a rare feat shared with only about 30 ETFs historically (Source).
- Bitcoin ETFs lead all ETF categories in year-to-date (YTD) inflows—remarkable given their mere 2.5 months in the market, compared to a full year for others (Source).
- Blackrock’s IBIT claims half of the inflows among all 420 Blackrock ETFs (Source).
- On the flip side, GBTC has seen more than $13 billion in outflows, the highest YTD across all 3,400 ETFs, with volume shrinking by over 40% (Source).
The outflows from GBTC were anticipated, also due to its higher fees relative to peers.
The generally strong performance metrics are even more impressive when you consider that ETFs typically accumulate AUM gradually, often not showing such immediate strength immediately after launch.
Now, some ETF issuers such as Blackrock are strategizing to channel investments into their Bitcoin ETFs through other diversified asset class ETFs. Additionally, there’s increased interest from pension funds, with hints of state funds considering an investment in the future.
So, there are signs that there will be further – maybe even stronger – demand signals in the short-term. This provides us with an interesting dynamic considering the upcoming Bitcoin halving in April, reducing the new Bitcoins coming on the market every day by 50%.