Spot Bitcoin ETFs to Overtake Gold ETFs after $100 Billion Milestone

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As a seasoned crypto investor with over two decades of experience under my belt, witnessing the rapid growth and maturation of the digital asset market has been nothing short of exhilarating. The latest milestone reached by US spot Bitcoin ETFs, surpassing $100 billion in assets under management (AUM), is a testament to the increasing institutional acceptance and demand for Bitcoin.

Reaching a significant landmark, US Bitcoin Exchange-Traded Funds (ETFs) have now managed over $100 billion in total assets. This impressive growth is attributed to substantial investments into these ETFs, alongside the recent surge in Bitcoin’s value up to around $98,000.

According to Eric Balchunas, Bloomberg’s senior ETF analyst, the combined assets under management (AUM) for Bitcoin and Ethereum has reached approximately $104 billion, thanks to a recent surge in Bitcoin’s price overnight. This significant milestone was achieved less than a year after its launch, which took place in January 2024.

As an analyst, I’m observing that during this specific timeframe, the accumulated investments into spot Bitcoin ETFs are rapidly approaching $30 billion, a figure that clearly demonstrates substantial investor enthusiasm for these products. Notably, the combined holdings of Bitcoin ETFs are nearly at par with Satoshi Nakamoto’s – the enigmatic creator of Bitcoin – position as the largest BTC holder, currently standing at 97%.

Moreover, Balchunas found that Bitcoin ETFs are almost 82% closer to surpassing the value of gold ETFs. This would serve as evidence of Bitcoin’s increasing importance as a store of value and investment choice. For your information, the combined asset under management (AUM) in U.S.-listed gold ETFs currently stands at $127 billion, according to Balchunas’ report.

As the Bitcoin price nears the $100K mark, there’s been a significant increase in investments into Bitcoin exchange-traded funds (ETFs). In fact, over the past couple of days, these ETFs have collectively received more than $700 million every day, making it two consecutive record-breaking days.

BlackRock’s IBIT has been capturing a larger share of the investments flowing into these financial products. Since its launch, IBIT has amassed over $30 billion in inflows, which is nearly three times greater than its closest rival, Fidelity FBTC.

Bitcoin ETF Options are Roaring, BlackRock Dominates

On its initial day of options trading, BlackRock’s iShares Bitcoin Trust ($IBIT) experienced significant action, resulting in approximately $1.9 billion worth of implied involvement through 354,000 contracts. Out of these, there were 289,000 call options and 65,000 put options, demonstrating a call-to-put ratio of 4.4 to 1 that suggests optimism among traders. This active trading occurred as Bitcoin reached new record highs, underscoring the expanding influence these options are having on the market.

Yesterday, the vast majority (97%) of options trading on Bitcoin ETF focused on the $IBIT option. Bloomberg analyst James Seyffart anticipates that this heavy skew may balance out as more arbitrageurs and quantitative traders become involved in the market, bringing stability to the situation.

Yesterday, the distribution of #bitcoin ETF options trading heavily favored option contracts for symbol $IBIT. Interestingly, IBIT traded nearly the same as its initial day around $1.9 billion in total value, but it accounted for an astonishing 97% of the volume. Here’s hoping that this skewed distribution normalizes somewhat with arbitrageurs and quantitative traders getting involved.

— James Seyffart (@JSeyff) November 21, 2024

As I, an analyst, observe the surging Bitcoin price approaching the $100K mark, I can’t help but anticipate that this upward trend could intensify even more. This prediction stems from the imminent influx of a massive $9.7 billion stablecoin supply into the market.

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2024-11-21 18:24