BlackRock and Fidelity Lead Inflows into Spot Bitcoin ETFs

BlackRock and Fidelity have emerged as the leading participants in a recent wave of interest, with confirmation of inflows of $1.9 billion and $1.6 billion, respectively, into their spot Bitcoin (BTC) exchange-traded funds (ETFs). With the U.S. Securities and Exchange Commission (SEC) having cleared ten asset managers for product listings, this confirmation strengthens their status as major issuers.

Leading the inflow trend are BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s Wise Origin Bitcoin Fund (FBTC), which together have taken in an astounding 70% of all inflows into exchange-traded spot BTC products. The dominance of these major players in the market demonstrates the increasing institutional interest in bitcoin investments.

Bitwise and ARK 21Shares, although trailing behind, also secured notable inflows, each surpassing $500 million. The Bloomberg data on Jan. 24 sheds light on the shifting landscape, with established financial players leading the charge in the competitive market.

Grayscale Faces Substantial Outflows Despite Market Dominance

In the two weeks following SEC clearance, Grayscale’s Bitcoin Trust (GBTC) had large withdrawals of around $4 billion, whilst BlackRock and Fidelity saw big inflows. Even with this withdrawal, Grayscale’s product—which has a market valuation of more than $20 billion and more than 500,000 Bitcoins in Coinbase custody—remains the biggest spot BTC ETF.

Ever since spot ETF trading began on January 11th, Grayscale has moved over 93,700 BTC, or roughly $3.9 billion, to Coinbase Prime accounts. Due to the large amount of money moving, Bitcoin has been under sell pressure, which has caused liquidations to satisfy redemption requests.

In the cryptocurrency world, Grayscale’s 1.5% ETF fee—the highest among issuers—has drawn criticism and attention. Michael Sonnenshein, CEO of Grayscale, defended the choice in the face of critics, emphasizing that their ETF is now the biggest, most liquid, and oldest spot Bitcoin ETF available. With rates as low as 0.21% recorded in this fiercely competitive industry, Sonnenshein ascribed other issuers’ lower fees to their novelty.

The growing institutional interest in bitcoin exchange-traded funds (ETFs) highlights how the landscape of cryptocurrency investments is changing, as demonstrated by BlackRock and Fidelity’s leadership.