🌎 Institutional Investors Flock to U.S. Bitcoin ETFs, Drive $13B Demand

U.S. Bitcoin Exchange-Traded Funds Capture Institutional Demand

Bitcoin exchange-traded funds (ETFs) in the U.S. have successfully attracted institutional interest after initial skepticism from legacy financial firms regarding this new asset class.

American institutions have purchased $13 billion worth of spot Bitcoin ETF shares since trading began in January. According to CryptoQuant CEO Ki Young Ju, who shared this data on October 22, 2024, 1,179 institutions have accumulated 193,064 BTC within 10 months. This information is based on Form 13F filings, which wealth managers use to disclose U.S. equity holdings.

Institutional Ownership and Market Impact

Institutional ownership of U.S. spot Bitcoin ETFs is approximately 20%, with asset managers holding 193K BTC, as per Form 13F filings. Traditional finance giants such as Millennium Management and Jane Street control 20% of the $65 billion market, equivalent to 961,645 BTC. These holdings are spread across 11 spot Bitcoin ETFs issued by BlackRock, Bitwise, Grayscale, and Fidelity, among others.

The increasing institutional adoption of spot BTC ETFs suggests that the initial reluctance towards Bitcoin-related funds was short-lived. Experts, including Bloomberg’s Eric Balchunas and James Seyffart, have noted that asset managers gradually adapt to new financial products.

Spot Bitcoin ETF Growth and Market Predictions

Less than a year after its launch, BlackRock’s BTC product became the fastest-growing ETF in U.S. financial history. Data indicates that BlackRock’s IBIT recorded the third-largest inflows, competing with ETFs that have been established for over 20 years.

Analysts highlight the demand for spot BTC ETFs, particularly in the U.S., as a significant driver for Bitcoin’s anticipated price increase. At the time of writing, one BTC is priced around $67,000, amidst a market-wide correction that has slowed the asset’s recent gains.

Market Sentiment and Future Projections

Firms like QCP Capital suggest that short-term volatility may impact BTC and digital asset markets leading up to the U.S. presidential election. However, researchers predict that price fluctuations will stabilize and historical trends will continue. The general market sentiment indicates that Bitcoin could trade above $100,000 by early 2025. Bitcoin enthusiasts, such as MicroStrategy’s Michael Saylor, even foresee a $13 million Bitcoin by 2045.