The iShares Bitcoin Trust (IBIT), managed by BlackRock, has achieved a major milestone by seeing zero inflows for the first time since the debut of Bitcoin exchange-traded funds (ETFs) in the United States. After a 71-day period in which the exchange-traded fund (ETF) regularly received significant investments every day, this marks the end of that trend.
The inflow of Bitcoin Exchange Traded Funds (ETFs) is slowing.
Other Bitcoin Exchange-Traded Funds (ETFs) have also seen a decline in investor interest, coinciding with the cessation of inflows associated with IBIT. Both the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB) were successful in attracting inflows of $5.6 million and $4.2 million respectively. However, with the exception of these two funds, the majority of Bitcoin Exchange Traded Funds (ETFs) had no daily inflows.
Exceptional performance from IBIT
Since its launch in January, IBIT has demonstrated exceptional performance, despite the current downturn in business. In total, the exchange-traded fund (ETF) amassed approximately $15.5 billion in assets under management in just 71 days. This performance allowed IBIT to surpass the US Global Jets ETF, placing it among the top 10 exchange-traded funds (ETFs) with the longest daily inflows.
ETF inflows and their influencing factors
There are a number of reasons that can be attributed to the current slowdown in ETF inflows. The decline in inflows has been attributed to macro causes such as rising government bond yields and geopolitical events in the Middle East, according to a study published by British-based bank Standard Chartered. It is possible that the initial wave of ETF buying has peaked, and the subsequent wave of inflows may depend on the integration of spot Bitcoin ETFs into larger macro funds.
The revenue generated by Grayscale’s GBTC
Grayscale’s GBTC, one of the most reputable investment vehicles for Bitcoin, has been experiencing regular daily outflows. The majority of Bitcoin exchange-traded funds (ETFs) had no net inflows on the day GBTC recorded a net withdrawal of $130.4 million. The outflow has prompted Grayscale to prepare to launch a new “mini Bitcoin ETF,” which will have lowered costs to compete with other companies and attract a larger number of investors.
Outlook for Bitcoin Exchange-Traded Funds
Despite the fact that inflows have slowed recently, there are indicators that interest in Bitcoin Exchange Traded Funds (ETFs) could be on the rise again. According to reports, Morgan Stanley is considering the possibility of allowing its 15,000 brokers to promote Bitcoin exchange-traded funds (ETFs) to their clients, which could lead to more money being poured into the funds. As an additional point of interest, the bank’s previous prediction that Bitcoin would reach $150,000 by the end of the year is still accurate.
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