Analysts rip up old estimates after BlackRock leads $3bn in Bitcoin ETF inflows

Analysts rip up old estimates after BlackRock leads $3bn in Bitcoin ETF inflows
Larry Fink's BlackRock is leading the spot Bitcoin ETF race.
  • The total net flows to US-based Bitcoin ETFs have surged, with BlackRock leading the charge.
  • Outflows for Grayscale’s GBTC are beginning to taper off entirely.

Spot Bitcoin exchange-traded funds are on course to beat annual estimates.

The news comes after the 10 US-based spot Bitcoin ETFs doubled their cumulative net flows to $3 billion in three days, with more than half a billion dollars added on Tuesday alone, data shows.

Spot Bitcoin ETFs are expected to see more price rises if the momentum of the past few days keeps up, crypto trading firm B2C2 said in a Tuesday newsletter.

The news comes mere months after Galaxy estimated there would be $14 billion of new inflows in the first year of spot Bitcoin ETFs being launched in an October blog.

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“Accounting for the circa $6.5 billion exiting GBTC, we have seen net inflows of $3.1 billion in a little over a month of trading,” B2C2 said.

“Whether this pace will be sustained remains to be seen but in crypto, price often drives flow,” B2C2 said.

The bullishness around spot Bitcoin ETFs has been identified as a key driver behind Bitcoin’s recent rally, which saw it pass the $50,000 mark last week.

BlackRock and Fidelity continue to dominate the ETF race, attracting the lion’s share among the other seven rivals in terms of assets under management, excluding Grayscale.

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The two Wall Street giants command 12.8% and 11.4% of the total assets under management, respectively.

An aggressive campaign to reduce management fees continues to play out, dubbed a “fee war,” by some analysts.

They’ve also been hailed as the most successful ETFs launched in the last 30 years, DL News reported Tuesday.

Outflows from Grayscale continue to diminish, easing pressure from sellers who had initially sought to cash out once the product had converted from a trust.

With a 66% share of the total Bitcoin held by the ETFs, Grayscale’s GBTC holds $22.9 billion in Bitcoin.

At the same time, outflows for Grayscale’s flagship product have dropped considerably this month following significant investor activity in January.

Total GBTC outflows dropped from around $600 million by mid-January to just under $100 million on February 13, according to London-based investment management firm Farside Investors’ data.

Sebastian Sinclair is a markets correspondent for DL News. Have a tip? Contact Seb at sebastian@dlnews.com.