The market was flooded with US Bitcoin ETFs the day after the announcement.
Now we can look at 12 months worth of data.
The morning of January 10, 2024 I read my article, in which I recapped the events that led to this landmark.
The Winklevoss twins filing for a bitcoin ETF in 2013; BTC futures funds hitting the US market in 2021; the SEC blocking Grayscale’s GBTC conversion the following year — and the firm then suing the regulator; BlackRock’s head-turning proposal in mid-2023; and, finally, Grayscale’s legal win.
The demand for bitcoin ETFs was predicted to be astronomical.
Spoiler: they did.
James Seyffart, a Bloomberg Intelligence Analyst, reflected back on the $15 billion net inflow he expected a year earlier. He told me that these were much higher than the expectations of most people in TradFi’s research. Yet, this is lower than the projections of some in crypto.
“Still, even issuers who expected these to be blockbuster hits did not expect them to do this well,” Seyffart said to me. “They now hold over 1.13 million bitcoin and have $100 billion in assets after taking in almost $38 billion of net inflows in their first year — more than double what we thought would have been a very successful launch.”
Bitwise’s 2025 Outlook Report argues that Bitcoin ETFs are likely to attract greater flows of capital in 2025 compared with 2024.
Some people have a more nuanced view.
Seyffart stated that a $15 billion annual inflow (which matches his original year-one forecast) is expected after products received roughly $16 billion of assets in Q4 alone. “a foregone conclusion assuming the economy avoids a recession.”
Seyffart did not give a specific projection for 2025, but he believes that bitcoin ETFs are likely to grow three times as large as gold ETFs in the next 3 to 5 years.
The biggest bitcoin ETF — BlackRock’s iShares Bitcoin Trust (IBIT) — has well surpassed its iShares Gold Trust (IAU) in AUM — ~$52 billion to ~$33 billion. IBIT still trails the SPDR Gold Shares, which has a total of $74 billion.
Seyffart pointed out bitcoin’s many uses, including as an alternative currency and a means of storing value. “hot sauce and satellite positions” In a portfolio, given that the asset is volatile.
NeenaMishra is the director of ETF Research for Zacks Investment Research. They both pointed out that more wirehouses are expected to approve bitcoin ETFs as catalysts in 2025. Morgan Stanley moved in August.
Meanwhile, BlackRock and Fidelity — as powerhouses in the asset management industry — are set to continue “legitimizing” Mishra also added that Bitcoin is something which can’t be missed.
“However, much will depend on bitcoin’s performance, as ETF flows tend to follow performance trends,” “She said”
The promise of progress in crypto regulation will be an important factor for the price of BTC by 2025, along with macro-factors.
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