Bitcoin ETFs Draw Nearly $600M in Daily Inflows amid Renewed Interest

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As a seasoned researcher with over two decades of experience in financial markets, I have seen my fair share of market trends and shifts. However, the consistent inflows into Bitcoin spot exchange-traded funds (ETFs) in the United States is a phenomenon that has piqued my curiosity and sparked my interest.

On December 12, U.S.-based Bitcoin spot ETFs experienced approximately $600 million in daily investments, marking the 11th consecutive day of investment since the beginning of the month.

The recent spike surpassing the significant $100,000 milestone has propelled Bitcoin’s inflows, shattering a key obstacle for potential future growth. This surge has sparked optimistic market feelings, leading institutional investors to gradually purchase Bitcoin ETFs in preparation for projected price rises.

Massive Inflows Signal Institutional Confidence

On Friday, we saw a total inflow of $600 million, which added up to a grand total of $35.17 billion in net gains for the fund so far. Currently, the combined value of all Bitcoin (BTC) holdings by issuers stands at approximately $112.55 billion, representing an increase of 5.68% since the initial investment.

According to data from SoSoValue’s blockchain ETF tracker, it was BlackRock’s iShares Bitcoin Trust (IBIT) that took the lead yesterday, attracting around $432 million in investments. This represents a notable recovery from its period of no investor activity on December 11.

The increase in activity has boosted BlackRock’s control over the Bitcoin market to approximately 3%. Regarding the recent rise in Bitcoin transactions, BlackRock considers a Bitcoin allotment within the range of 2% as “a reasonable proportion” for diverse investment portfolios.

This massive financial institution, responsible for managing over $11.5 trillion in assets, posited that assigning a 1% to 2% allocation to Bitcoin could provide a comparable risk level as investing in the famed “Magnificent Seven” technology companies.

These remarks surface during a rising wave where businesses are increasingly opting for Bitcoin as a protective measure, used to safeguard against market fluctuations and unexpected difficulties.

This week, Jetking Infotrain Limited, an Indian technology company, made history by becoming the first publicly traded business in India to incorporate Bitcoin as part of its corporate reserves. On December 9th, the 77-year-old organization purchased approximately 12 Bitcoins, equivalent to around $1.2 million, marking their entrance into the cryptocurrency market.

Broader Market Participation

Additionally, it’s worth noting that the Fidelity Wise Origin Bitcoin Fund (FBTC) also experienced substantial investments on December 12. Data from SoSoValue indicates that institutional investors purchased a total of $30.54 million in FBTC shares, increasing its overall net inflows to an impressive $12.25 billion.

Furthermore, ETFs related to Bitcoin such as the ARK 21Shares Bitcoin ETF (ARKB), Bitwise Bitcoin ETF (BITB) and WisdomTree Bitcoin Trust (BTCW) have been quite active. Specifically, these funds experienced inflows of $8.97 million, $61.45 million, and $2.65 million respectively.

On the other hand, not every fund experienced the surge of optimism. Contrary to the general trend, Grayscale’s Bitcoin Trust (GBTC) saw outflows amounting to approximately $48.40 million. However, this was an exception as its Grayscale Bitcoin Mini Trust (BTC) witnessed inflows totaling $110.76 million, demonstrating varied attitudes towards investment among institutional investors.

On December 12th, it was noted that there was no trading activity observed in the Bitcoin Exchange-Traded Funds (ETFs) such as Invesco Galaxy Bitcoin ETF (BTCO), Franklin Templeton Digital Holdings Trust (EZBC), and Hashdex Bitcoin ETF (DEFI) that are traded on US stock exchanges.

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2024-12-13 13:19