The IBIT ETF from BlackRock is now the fifth-largest of all US ETFs by inflows, despite heavy outflows from Grayscale’s product.
The spot Bitcoin exchange-traded fund (ETF) from giant asset manager BlackRock Inc (NYSE: BLK) is now the fifth-largest ETF by inflows, across all markets. According to Bloomberg Intelligence data, the BlackRock iShares Bitcoin Trust (IBIT) has taken in more than $3.1 billion since trading began less than a month ago.
BlackRock Inflows Hit Record after Only 17 Days
Bloomberg Senior ETF Analyst Eric Balchunas posted an image on X, with the 10 largest ETFs for the year based on inflows. According to his post, IBIT has now “taken in more cash than 99.98% of ETFs. Not bad for 17 days old.”
The number one position is the iShares Core S&P 500 ETF (IVV), which has $13 billion this year. The next is the Vanguard 500 Index Fund ETF (VOO), at $11.1 billion in year-to-date (YTD) inflows. The two funds have $428 billion and $398 billion, respectively, in assets under management (AUM). Interestingly, Fidelity’s spot Bitcoin ETF, the Fidelity Wise Origin Bitcoin Fund (FBTC) was eighth on the list, with $2.7 billion in inflows.
On trading volumes, the spot Bitcoin ETFs have been seeing healthy competition. Regarding net inflows, both Fidelity Investments and BlackRock have taken the lead. However, last Tuesday, Grayscale Investments recorded a higher trading volume than both. While Fidelity had $388 million and BlackRock recorded $383 million, Grayscale Investments was higher, at $396 million. All three have been the major contributors to the total trading volume of spot Bitcoin ETFs. The three have accounted for about 90% of trading activity on some days.
Bitcoin ETFs and Outflows
Unfortunately, Grayscale’s ETF has seen significant outflows since the conversion of the GBTC fund. On Tuesday, January 23rd, Grayscale’s GBTC lost a heavy $640 million, a record for the largest single-day outflow. At the time, the total outflow had hit $3.45 billion, according to an X post from Bloomberg ETF analyst James Seyffart.
Balchunas has said that he believes 35% of the GBTC outflows are flowing into other ETFs, likely because of GBTC’s fee. Last month, Grayscale’s Chief Executive Officer Michael Sonnenshein defended the firm’s 1.5% management fee, the highest of the spot Bitcoin ETFs. According to him, the liquidity available, including the company’s size and proven track record, are factors to consider. Sonnenshein spoke with Bloomberg Television from Davos at the World Economic Forum.
Per the Grayscale outflows, defunct crypto exchange FTX played a major part. According to reports, FTX’s bankruptcy estate liquidated its GBTC holdings, selling 22 million shares for about $1 billion. Before the conversion to an ETF, the GBTC fund had about $0 billion worth of assets.
The heavy outflows dampened Bitcoin market sentiment and affected the king coin’s price, which fell below $40,000. As of this writing, Bitcoin is trading at $43,070, according to CoinMarketCap, after rising 1.19% in the last 24 hours. Despite Bitcoin’s seeming indifference to spot Bitcoin ETFs and the upcoming halving, ARK Invest’s Cathie Wood believes BTC is replacing gold as a store of value.
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