Bitwise CEO Hunter Horsley has made a bold prediction about the future of Bitcoin exchange-traded funds (ETFs) in the wealth management industry. Horsley’s forecast aligns with the prevailing market sentiment that ETFs will experience increased demand, especially following the recent Bitcoin halving.
One notable development is the narrowing gap between BlackRock’s iShares Bitcoin Trust (IBIT) and Grayscale’s Bitcoin Trust (GBTC), with the former standing just $2 billion behind the latter. This puts BlackRock in a position to potentially surpass Grayscale as the world’s largest Bitcoin fund. However, GBTC has faced a 68-day period of declining value, losing nearly $16 billion and reducing its assets to $19.4 billion.
On the other hand, IBIT has seen continuous asset growth, reaching approximately $17.3 billion in total assets. Nevertheless, Grayscale’s spot Bitcoin ETF has experienced notable capital outflows, with investors withdrawing $89.9 million in the past five days alone, contributing to a net outflow of $1.6 billion since January.
Despite Grayscale’s initial dominance in the Bitcoin ETF market, Fidelity and BlackRock have quickly gained significant market shares since entering the scene. For example, Fidelity and BlackRock Bitcoin ETFs saw net inflows of $37.3 million and $18.7 million, respectively, in the same week, which helped alleviate some of the market’s liquidity issues.
Bitwise’s CEO describes the adoption of Bitcoin ETFs by registered investment advisers (RIAs) and multifamily offices as “stealthy but significant.” He highlights that major financial institutions are quietly conducting comprehensive assessments of the Bitcoin market.
Recent data from Farside shows that GBTC experienced outflows of $17.5 million on April 10, a significant decrease from the $154.9 million outflows recorded the day before. The lowest outflow was on February 26 when GBTC saw $22.4 million leave the fund. Since January, the average daily outflow for GBTC has been $257.8 million.
GBTC, which launched in 2015 and converted to an ETF in January, along with the launch of nine other spot Bitcoin ETFs, won a lawsuit against the U.S. Securities and Exchange Commission. This legal victory forced the SEC to review a previous denial of GBTC’s conversion bid.
In a separate development, bankrupt crypto lending firm Genesis sold approximately 36 million GBTC shares to acquire 32,041 BTC.
Overall, the article highlights the growing interest and potential shift in the Bitcoin ETF market, with wealth management firms poised to increase their holdings in such funds.