Spot Bitcoin (BTC) exchange-traded funds (ETFs) from asset management giants BlackRock and Fidelity saw close to $5 billion in net inflows during their first 12 trading days, placing them among the ETFs with the largest inflows in January.
BlackRock’s IBIT and Fidelity’s FBTC Ranked Among the Top-performing ETFs in January
As per a recent report from Morningstar, BlackRock’s iShares Bitcoin Trust (IBIT) took in an estimated $2.6 billion in net flows, while the Fidelity Wise Origin Bitcoin ETF (FBTC) recorded $2.2 billion in inflows.
IBIT was ranked eighth and FBTC landed tenth place among exchange-traded funds with the largest net inflows last month.
Data procured by the investment research firm also showed that the Grayscale Bitcoin Trust (GBTC) had the second-highest net outflows during the 12 trading days last month, with $5.7 billion estimated to have exited the fund throughout January.
Morningstar’s report comes amid spot Bitcoin ETFs in the US recording six straight days of net positive inflows totaling nearly $715 million. A vast majority of these transactions were carried out by BlackRock and Fidelity’s funds.
IBIT Became the First Bitcoin Spot ETF to Surpass GBTC in Daily Trading Volume
Grayscale’s fund has dominated the spot Bitcoin ETF market in terms of daily trading volume since the products began trading in the US on January 11. However, this dominance ended on February 1 when IBIT and ProShare’s Bitcoin Strategy ETF (BITO) became the first of the nine funds tracking the leading cryptocurrency to surpass GBTC’s trading volume.
Bloomberg Intelligence analyst James Seyffart noted that BlackRock’s iShares Bitcoin Trust was the first ETF to trade more than GBTC in a single day.
While IBIT led the charts with a $301 million trading volume and BITO ended Thursday with $298 million worth of trades placed, GBTC came in third with $292 million in total trades.
Between January 26 and February 6, the net flows into the nine new spot Bitcoin ETFs surpassed the outflows from the Grayscale Bitcoin Trust, which has relatively slowed down over the past week. The six-day run of inflows follows a four-day spree of outflows in the trading days from January 22 to 25 that saw a $431.8 million net exit from the ten Bitcoin spot exchange-traded funds.
GBTC hit its second-lowest daily outflow on February 2 at $144.6 million.
Bloomberg’s senior ETF analyst Eric Balchunas wrote in an X post shared on February 3 that it was “really something” to see the nine ETFs other than GBTC make a comeback from the previous week’s dip.
He noted that typically there is a slow decline after a “big hyped launch” but the net inflows into spot Bitcoin ETFs on their third trading week show that the exchange-traded products (ETPs) “have legs”.
ETF Issuers Accumulate 3.3% of Bitcoin’s Circulating Supply in Three Weeks
Funds from Investment giants including BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK Invest, Invesco, VanEck, WisdomTree, Hashdex, Bitwise, Valkyrie, and BZX have accumulated approximately 3.3% of Bitcoin’s current supply since they began trading.
According to recent data, there are 19.61 million BTC, worth $836 billion, currently in circulation.
Despite expectations that spot Bitcoin ETFs would spark an imminent price surge for the leading crypto asset, the opposite has occurred. Since the funds were greenlit by the US Securities and Exchange Commission (SEC) on January 10, BTC’s price has declined by around 10% but the market remains stable.
Pro-BTC President Nayib Bukele Wins Second Term in El Salvador
In what is another positive development for the apex cryptocurrency, El Slavador’s Bitcoin-friendly incumbent president Nayib Bukele has won the general election by a landslide.
The result was not a surprise as the President who has been in office since 2019 has enjoyed great popularity in the Central American nation. In a tweet, Bukele said that he had won the presidential election with more than 85% of the votes and a minimum of 58 out of 60 deputies in the National Assembly.
In 2021, El Salvador became the first country in the world to adopt Bitcoin as legal tender. The government developed and introduced a digital wallet called Chivo to enhance domestic crypto adoption and also started buying Bitcoin for the national treasury.
According to data by Nayibtracker.com, which keeps tabs on President Buekele’s Bitcoin investments, the government holds 2,825 BTC worth approximately $120.4 million at the current rate.
The move that was widely appreciated by the Bitcoin and crypto community faced criticism from financial institutions like the International Monetary Fund (IMF) and the World Bank.
In January 2023, President Bukele announced that the country had paid back $800 million on an external bond, plus interest. This was despite concerns that Central America’s smallest economy would default on its debt as a result of its bold move to accept Bitcoin.
In December, the El Salvadorian parliament approved the $1 billion Volcano Bond, which are sovereign-debt bonds backed by BTC that will used to pay down the country’s debt, fund the construction of the ‘Bitcoin City’, and the creation of a sustainable Bitcoin mining facility powered solely by renewable energy, including geothermal.
At the time of writing, Bitcoin (BTC) is trading at $42,664 – down 0.5% in the last 24 hours.
