Bitcoin ETFs Gobble Another $477 Million Despite Rising GBTC Sales

Bitcoin ETFs Gobble Another $477 Million Despite Rising GBTC Sales

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Bitcoin spot ETFs in the United States absorbed another $477 million in net flows on Thursday, maintaining record growth despite a revival of outflows from the Grayscale Bitcoin Trust (GBTC).

Data compiled from BitMEX Research shows that Bitcoin ETFs have absorbed over $400 million of flows for five of the last seven trading days. Since launch, they’ve now soaked up over $4.5 billion in BTC – or $11.3 billion when discounting outflows from Grayscale.

Bitcoin ETF Flow – 15th Feb

All data out. Very strong day. +$477m of net ETF flow

— BitMEX Research (@BitMEXResearch) February 16, 2024

Non-Stop Flows For Bitcoin ETFs

About $330 million of flows went into BlackRock’s iShares Bitcoin Trust (IBIT), a top-five daily performance for the fund so far.

The Bitwise Bitcoin ETF (BITB), the fourth largest of the nine newly launched ETFs, saw its best day besides launch day, absorbing $120.2 million in funds.

“Grateful to investors entrusting Bitwise to steward their investment,” Bitwise CEO Hunter Horsley tweeted on Thursday. “Excited about 2024 for Bitcoin investors.”

Opposite to BlackRock and Biwise, Grayscale has suffered non-stop losses since converting into a Bitcoin ETF on January 11.

The firm’s relatively high fees encouraged investors to find cheaper BTC investment options. Additionally, long-term investors have taken the opportunity to cash out of the fund since its share discount was restored to parity upon conversion, including the FTX bankruptcy estate with its $900 million GBTC stash.

The BTC Supply and Demand Mismatch

Earlier this week, another bankruptcy estate was approved to sell its $1.3 billion in GBTC shares: Genesis – the trading desk that shares DCG as a parent company with Grayscale.

Some onlookers suspect the approval is what’s driven up GBTC outflows in recent days, possibly halting Bitcoin’s price momentum at $52,000. Outflows ramped up from $72 million on Wednesday to $132 million on Thursday, and again to $174 million on Thursday.

Given the ongoing demand for Bitcoin ETFs, some analysts – including Bitwise CIO Matt Hougan – have noted that Bitcoin is currently under a major “supply/demand mismatch” between the number of BTC produced since the ETFs went live versus the number absorbed by ETFs each day.

Supply/demand mismatch.

— Matt Hougan (@Matt_Hougan) February 16, 2024

“With ETF demand… we’re just eating through the Available For Sale supply at $52k until there’s none left,” Onramp COO Jesse Myers wrote to X on Friday. “At that point… price has to jump to the next price level where there are willing sellers.”

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