Despite significant outflows from Grayscale’s GBTC following its transition to a spot ETF, the total assets in the newly approved spot bitcoin exchange-traded funds have grown. With three days of trading completed, approximately 21,000 bitcoin or $894 million have flowed into these new ETFs, based on the current $BTC price of $42,600.
Leading the influx, BlackRock’s iShares Bitcoin Trust (IBIT) added 16,362 bitcoin, followed by Fidelity’s Wise Origin Bitcoin Fund (FBTC) with 12,112 bitcoin. Notably, Grayscale’s Bitcoin Trust (GBTC) experienced sizable exits, losing around 25,000 bitcoin, impacting the overall industry inflow.
GBTC, previously a closed-end fund, converted into an ETF alongside new products from companies like BlackRock after the U.S. Securities and Exchange Commission’s approval of bitcoin ETFs last week. GBTC, with its 2% management fee and approximately 630,000 bitcoin holdings before ETF approvals, saw reduced fees (1.5%) in its ETF version. However, this fee is still higher than its new competitors, and the conversion eliminated its discount to net asset value (NAV), prompting GBTC holders to sell.
Despite this, the net inflows into the ETFs exceeded the outflows, indicating a positive trend overall. Bitcoin’s price has stabilized between $42,000 and $43,000 this week, experiencing a slight dip at the time of reporting.
The debate now centers on whether the bitcoin ETF launch can be deemed a success or a bust. While some emphasize the substantial trading volume of $10 billion in the first three days and consider it a success for the ETF world, critics point to the modest price movement and the significant selling from GBTC. The outcome, whether success or bust, may ultimately depend on bitcoin’s future price performance.
