U.S. Bitcoin ETFs met a tsunami of inflows on Monday as Bitcoin (BTC)’s price came roaring back above $43,000.
The asset absorbed $255 million of net flows across all ten publicly traded spot ETFs that launched on January 11. That even factors in the Grayscale Bitcoin Trust (GBTC) – the oldest and largest of the bunch which has suffered consistent nine-figure daily outflows since converting into an ETF.
Specifically, Grayscale’s outflow figure was $191.7 million on Monday, according to BitMEX Research. That’s a significant decline from the same time last week, when the fund lost a whopping $640 million in assets.
By comparison, inflows to the Fidelity Wise Origin Bitcoin Trust (FBTC) alone outweighed Grayscale’s with $208.2 million of net flows.
BlackRock’s iShares Bitcoin Trust (IBTC) followed at a close second with $198.4 million worth of flows, while Bitwise and Ark’s ETFs absorbed $20 million and $17.2 million respectively.
In total, all U.S. Bitcoin ETFs have absorbed $1.01 billion in net flows as of Tuesday. The AUM of ETF providers is now well above that held by silver ETFs in the country, making Bitcoin the second largest ETF commodity next to gold.
Bitcoin ETF Flow – Day 12
All data out. Strong day, with $255m net inflow overall pic.twitter.com/XPQNz496gj
— BitMEX Research (@BitMEXResearch) January 30, 2024
Grayscale Outflows Slow Down
Grayscale has lost over $5 billion worth of Bitcoin previously in its possession, but its outflow rate appears to be slowing. Analysts believe some of its early clients have spent the past few weeks cashing out after the value of its shares was restored to parity with that of its underlying BTC holdings.
Bankrupt crypto exchange FTX was responsible for another major part of the selloff, selling $900 million worth of GBTC shares once the fund finished transitioning into an ETF.
The fund’s declining volume presents another sign that the sale storm is over, with IBIT’s volume rivaling that of GBTC for two consecutive trading days this week. On Tuesday, Bitcoin spot ETFs handled $806 million in trading volume, including over $350 million from both Grayscale and BlackRock’s funds.
BlackRock’s 0.1% management fee is far smaller than Grayscale’s at 1.5%, prompting many investors to rotate their assets from the latter fund into the former.
“$100 million of bitcoin fits on a device the size of a thumb drive,” said Bitwise CEO Matt Hougan on Tuesday regarding Bitcoin ETF’s low fees. “There are advantages to being natively digital.”
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