Spot Bitcoin ETF in 4 Days: Winners and Losers Revealed, IBIT Surges with $1.084B Inflow
The first week of trading for the new spot Bitcoin exchange-traded funds (ETFs) in the U.S. has seen strong demand from investors, with over $1 billion in net inflows, according to data from CryptoQuant. However, the largest and oldest Bitcoin fund, Grayscale Bitcoin Trust (GBTC), has suffered huge outflows, as investors switch to the cheaper and more efficient ETF products.
Winners and losers
Among the 11 spot Bitcoin ETFs that launched last week, the clear winner was iShares Bitcoin Trust (IBIT), managed by BlackRock, the world’s largest asset manager. The ETF had a positive flow of $1.084 billion, equal to about 25,000 bitcoins, in the first four days of trading.
The second place was for Fidelity Bitcoin Fund (FBTC), which had an inflow of $884 million, equal to about 21,000 bitcoins. Fidelity is another giant in the asset management industry, with over $11 trillion in assets under administration.
Other ETFs that saw significant inflows were Bitwise Bitcoin Fund (BITB), 21Shares Bitcoin Fund (ARKB), and Invesco Bitcoin Strategy ETF (BTCO), with $373 million, $278 million, and $135 million, respectively.
However, the biggest loser was Grayscale Bitcoin Trust (GBTC), which saw a massive outflow of -$1.627 billion, which is equivalent to about 38,000 bitcoins. GBTC is the oldest and largest Bitcoin fund in the U.S., with over $30 billion in assets under management. However, it has been trading at a persistent discount to its net asset value (NAV), meaning that investors are paying less than the actual value of the bitcoins held by the fund.
Flows between funds
The popularity of IBIT is also evident in the daily flow chart, which shows the net inflow or outflow of each ETF product. IBIT had the highest flows on all four ETF-trading days, ranging from $117 million to $386 million.
The second place was more balanced, with different ETFs taking the lead on different days. BITB had the highest flow on the first day, with $237 million, followed by FBTC on the second and fourth days, with $195 million and $359 million, respectively. ARKB had the highest flow on the third day, with $123 million.
On the other hand, GBTC had high outflows for all four days, ranging from -$282 million to -$542 million. It is unclear whether this trend will continue, but it would be positive for the Bitcoin market if the selling pressure from GBTC decreases in the coming days.
The chart below shows the daily flows of all ETF products, excluding and including GBTC. The orange line represents the daily inflow or outflow from the new spot Bitcoin ETFs, while the purple line represents the real flow of funds, taking into account GBTC.
The chart shows that there is high demand for the new spot Bitcoin ETFs, but it has been overshadowed by GBTC. The daily flows excluding GBTC were positive for all four days, reaching a peak of $625 million on the first day. However, the daily flows including GBTC were negative for three out of four days, reaching a low of -$406 million on the second day.
The cumulative value of all ETF products is just increasing, despite the negative impact of GBTC. On the launching day, there was a net inflow of $625 million, but by the fourth day, it had surged to $1.28 billion.
At the current price of $42,000 per bitcoin, this amounts to 30,000 bitcoins purchased by the institutional investors, or the “suits”, as some in the crypto community call them.
The new spot Bitcoin ETFs offer investors a more direct and cost-effective exposure to the cryptocurrency, as they do not have to deal with the complexities and fees of futures contracts or the technicalities and risks of holding the digital asset themselves. They also have lower expense ratios than GBTC, which charges 2% annually.
The launch of the spot Bitcoin ETFs in the U.S. is seen as a major milestone for the crypto industry, as it signals the growing acceptance and adoption of Bitcoin by the mainstream financial system. It also opens the door for more innovation and competition in the crypto ETF space, as well as the possibility of a spot Ethereum ETF in the near future.
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