Bitcoin ETFs post $2.2B net inflows in a week

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Bitcoin exchange-traded funds (ETFs) had another strong week, with net inflows surpassing $2.2 billion from Feb. 12–16. According to Bloomberg analyst Eric Balchunas, the combined volume was higher than inflows received by any other among the 3,400 ETFs available in the United States. 

BlackRock’s iShares Bitcoin Trust (IBIT) received the majority of capital, amassing positive flows of $1.6 billion over the week, according to data from BitMEX Research. “$IBIT alone has taken in $5.2b YTD, which is 50% of BlackRock’s total net ETF flows, out of 417 ETFs,” noted Balchunas.

Among the spot Bitcoin (BTC) ETFs holding billions of dollars in assets, Fidelity’s Wise Origin Bitcoin Fund saw significant inflows, attracting $648.5 million over the last five trading sessions. The Ark 21Shares Bitcoin ETF garnered $405 million during the same period, while the Bitwise Bitcoin ETF pulled $232.1 million in capital inflows.

Outflows from the Grayscale Bitcoin Trust are hampering the combined performance of the other newly approved spot Bitcoin ETFs. The fund saw $624 million in withdrawals from Feb. 12–16 as investors continued to sell. Since its conversion from an over-the-counter product to a spot ETF on Jan. 10, Grayscale’s fund has seen over $7 billion in capital outflows.

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ETFs flows from Feb. 12–16. Source: Bloomberg Intelligence/Eric Balchunas.

The new ETFs are believed to be one of the factors driving Bitcoin’s recent price gains. The cryptocurrency is up 91% in the past four months, supported by market sentiment surrounding the approval of spot Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) on Jan. 10.

During the week, Bitcoin gained nearly 7% and is trading at $51,434 at the time of writing, climbing 24% in February.

Major banks and financial institutions are also taking notice of the new ETFs. In a Feb. 14 letter, a trade group coalition representing Wall Street’s biggest firms requested the SEC to consider modifications to the Staff Accounting Bulletin 121, which provides guidance around accounting for crypto asset custody obligations. The revision would allow banks to act as custodians of the BTC funds.

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