As an analyst with experience in the crypto market, I’ve been closely monitoring the recent trends in Bitcoin Exchange-Traded Funds (ETFs), specifically the BlackRock Bitcoin ETF (IBIT). While there have been positive inflows into spot Bitcoin ETFs overall, IBIT has yet to gain significant momentum. For five consecutive trading days, the fund has reported zero inflows.
This week, the accumulated investments into bitcoin spot ETFs shifted from outflows to inflows after a significant decrease in June. However, the BlackRock Bitcoin ETF (IBIT) has yet to gain substantial traction as the enthusiasm for ETFs appears to dwindle. For five consecutive trading days, IBIT recorded no new investments.
BlackRock Bitcoin ETF Losing Steam?
On Thursday, June 27th, Bitcoin spot ETFs recorded a total net inflow of approximately $11.7997 million. Concurrently, Grayscale’s GBTC saw outflows amounting to around $11.4 million the previous day. As a result, the cumulative withdrawals from GBTC since inception now surpass $18.5 billion.
Additionally, it’s worth noting that major market analysts aren’t alarmed by the absence of new investments in BlackRock’s iShares Basic Materials U.S. Aggregate ETF (IBIT). This is due to the fact that BlackRock is purchasing IBIT shares through its other funds.
According to the most recent SEC document, BlackRock announced the purchase of Bitcoin for its Global Allocation Fund. This marks the third BlackRock investment vehicle that holds Bitcoin, achieved through investing in the IBIT Bitcoin ETF.
BlackRock’s Global Allocation Fund acquired a sum total of 43,000 shares in the iShares Bitcoin ETF as part of its recent investments. Previously, BlackRock’s Strategic Global Bond Fund and Strategic Income Opportunities Portfolio had also made comparable purchases.
BTC ETFs on the Backseat?
During the initial quarter of the year, there was considerable enthusiasm among institutions regarding Bitcoin ETFs. However, this interest appears to be waning. One significant factor contributing to this trend is the Federal Reserve’s indication that it may maintain higher interest rates for an extended period than initially anticipated. Consequently, the market’s excess liquidity is drying up rapidly.
Alternatively, Bitcoin is encountering rivalry from cryptocurrencies such as Ethereum (ETH) and Solana (SOL). It’s anticipated that the Ethereum ETF will debut around July 2-4 next week. Consequently, investors could be holding back funds in preparation for investing in this new crypto ETF. According to Coingape, Ethereum ETFs may draw approximately 15% of the investment as US BTC ETFs.
Instead, VanEck applied for a Solana ETF last Thursday, increasing the level of rivalry. While it’s uncertain if the Solana ETF will receive approval soon, potential investors now have additional choices in the market.
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2024-06-28 08:45