By
Chimamanda U. Martha
April 26th, 2024
Hougan’s bullish prediction is based on Bitcoin’s impressive growth of nearly 300% over the past 15 months.
Bitwise Chief Investment Officer (CIO) Matt Hougan has made a bold prediction regarding Bitcoin’s spot ETFs, suggesting that they could see trillions of dollars in inflows.
This comes after a week that started with net outflows but quickly turned around, indicating a growing confidence in Bitcoin and its related financial products among investors. The week saw a notable shift from five consecutive days of outflows to a significant net inflow of $480 million on Tuesday, followed by another $243.5 million on Wednesday.
Blackrock Leads Inflows, Grayscale GBTC Sees Outflows
Wednesday’s spot Bitcoin ETF recovery was mostly due to a big inflow of $323.8 million from Blackrock, which helped balance out Grayscale GBTC’s outflows of $299.8 million. Ark Invest’s ARKB also had a great day, bringing in $200 million.
Fidelity, on the other hand, lost $1.5 million, which was its worst day ever. But Fidelity quickly got back on its feet with $261 million coming in on Monday and $279 million coming in on Tuesday.
In a recent interview, BlackRock CEO Larry Fink praised IBIT as the fastest-growing ETF ever and noted his surprise at Bitcoin’s swift value rise.
Today on Fox Business, #BlackRock CEO #LarryFink expressed optimism about #Bitcoin, highlighting the remarkable growth of their spot Bitcoin ETF, $IBIT, which has now become the fastest-growing ETF in history. #BitcoinETFs #BitcoinHalving #CryptoNews #Cryptocurency pic.twitter.com/7IxOeYqvSP
— TechResearcho (@TechResearcho) March 28, 2024
Adding to the buzz, Fidelity’s FBTC has surpassed $10 billion in assets under management, becoming the second Bitcoin ETF to achieve this milestone after IBIT hit $10 billion on March 1st.
Hougan was positive about the future of Bitcoin ETFs in a recent memo to investment professionals, stating that “1% Down, 99% to Go”. However, Hougan told buyers to keep a long-term view, even though Bitcoin’s price has been going back and forth between $60,000 and $70,000 recently.
Bitcoin’s Raging Bull Market and Institutional Interest
Hougan’s bullish prediction is based on Bitcoin’s impressive growth of nearly 300% over the past 15 months. He sees the launch of spot Bitcoin ETFs in January as a significant milestone, opening up the Bitcoin market to a new class of investors. This sentiment is shared by global wealth managers, who are increasingly exploring Bitcoin investments, managing over $100 trillion in assets.
Hougan’s analysis suggests that even a modest 1% allocation of global wealth managers’ portfolios to Bitcoin could result in approximately $1 trillion of inflows. He also noted that historical data shows a 2.5% allocation to Bitcoin has improved the risk-adjusted returns of traditional portfolios.
Even though a lot of money has been pouring into Bitcoin ETFs lately, Hougan thinks this is just the start of a much bigger trend. He said that even though $12 billion has been put into ETFs since January, this is still a small amount of the growth that could happen. Hougan came to the conclusion that “a 1% allocation across the board would mean ~$1 trillion coming into the space”. In light of this, $12 billion is not even close to a down payment according to Houghan noting that, “1% done, 99% to go”.
The combined trading volume of all spot Bitcoin ETFs has reached $178 billion. At the time of writing, Bitcoin is priced at $70,879, reflecting a 1% increase in the last 24 hours and a 5.8% rise over the past week.
