- BlackRock and Fidelity’s Bitcoin ETFs have seen massive inflows, accounting for 50-70% of the companies’ total ETF flows this year. The funds attracted investment for 49 days straight, a rare feat.
- The ETFs’ growth highlights surging institutional demand for crypto exposure. The funds have greatly outperformed the broader ETF market.
- Data shows ETF investors are strategic and resilient across cycles. They added billions during stock market crashes in 2008 and 2021. The Bitcoin ETF inflows amidst volatility reflect investor confidence.
Bitcoin exchange-traded funds (ETFs) have rapidly become the most popular offerings from asset managers BlackRock and Fidelity Investments. Despite only launching in January, the funds have attracted significant inflows and outperformed the broader ETF market. The strong demand highlights the growing appetite for Bitcoin exposure among institutional investors.
BlackRock’s Blockbuster Bitcoin Fund
BlackRock’s spot Bitcoin ETF, the iShares Bitcoin Trust (IBIT), has accounted for over half of the company’s net inflows so far this year. This is an impressive feat considering BlackRock offers over 400 other ETFs. In less than 50 days of trading, IBIT has brought in double the capital of any other BlackRock ETF launched in 2023.
Similarly, Fidelity’s Fidelity Wise Origin Bitcoin Trust (FBTC) makes up 70% of Fidelity’s year-to-date flows. FBTC has attracted 5 times more investment than any other Fidelity ETF this year.
Unprecedented 49-Day Inflow Streak
Both IBIT and FBTC have secured cash inflows for 49 consecutive days, an exceptionally rare achievement for new ETFs. This feat places them fourth among active inflow streaks, behind only two ETFs with 100+ day runs. Just 30 ETFs in history have ever reached a similar 49-day streak from launch.
ETF Investors Show Resilience
Some speculate that ETF investors lack sophistication and easily withdraw during downturns. However, recent data counters this narrative. Major Bitcoin ETFs saw $1.2 billion in inflows last week despite an 8% BTC price drop.
ETF pioneer Eric Balchunas notes historical data also shows ETF investors are strategic and resilient across cycles. In 2008, ETFs saw $167 billion in inflows amidst a 35% S&P 500 plunge. In 2021, ETFs added another $600 billion in inflows despite an 18% S&P 500 correction.
Conclusion
The meteoric rise of BlackRock and Fidelity’s spot Bitcoin ETFs defies expectations. Their unmatched early growth signifies surging institutional appetite for crypto exposure. Moreover, ETF investors have demonstrated remarkable confidence and patience during Bitcoin’s volatility. While some products fade quickly, BlackRock and Fidelity’s ETFs are cementing themselves as staples for strategic crypto exposure. Their success underscores Bitcoin’s accelerating mainstream adoption.
