CoinShares, a European digital asset manager, notes that the hype surrounding Bitcoin ETFs is slowing down despite the recent increase in Bitcoin prices, with the digital asset reaching above $71,000 per coin. The firm points out that while the biggest Bitcoin funds are still receiving significant inflows, the numbers have decreased from their peak in early March. CoinShares’ data shows that the total volume traded for Bitcoin ETFs declined to $17.4 billion last week, compared to $43 billion in the first week of March. Flows to digital asset products for the week totaled $646 million, with the vast majority going towards gaining exposure to Bitcoin over other cryptocurrencies. Year to date, inflows for digital asset products have reached $13.8 billion, surpassing the $10.6 billion seen in 2021.
Most of the inflows for digital asset products have been absorbed by a few Bitcoin spot ETFs approved in January, which have received $12.6 billion in net flows since their launch. The total volume traded by these ETFs in March exceeded $111 billion, significantly higher compared to the previous months. However, the Grayscale Bitcoin Trust (GBTC) stands out as the only US Bitcoin spot ETF experiencing continuous outflows since its launch. This is attributed to early investors who are cashing out during Bitcoin’s price surge, as well as the fund’s higher management fee compared to its competitors. Internationally, similar trends are observed where Swiss and Canadian crypto funds lost $27 million and $7.3 million last week, respectively. Canada’s Purpose Bitcoin ETF, the first Bitcoin spot ETF globally, has lost over 20% of its Bitcoin since the launch of equivalent products by BlackRock and Fidelity in January.
While overall flows continue for Bitcoin funds, short Bitcoin investment products have seen their third consecutive week of outflows totaling $9.5 million. Ethereum, on the other hand, experienced its fourth consecutive outflow week, losing $22.5 million from related funds. It is noteworthy that Ethereum is yet to receive its own spot ETF, and experts are becoming less optimistic by the day about the current round of applications for the product being approved by the deadline in May. CoinShares’ data indicates that short Bitcoin investment products are seeing a third straight week of outflows worth $9.5 million, while Ethereum has experienced its fourth consecutive outflow week, losing $22.5 million from related funds.
Despite the slowdown in Bitcoin ETF hype, CoinShares highlights that overall flows continue for Bitcoin funds, with a significant amount of inflows coming from a few Bitcoin spot ETFs approved in January. However, the Grayscale Bitcoin Trust stands out as the only US Bitcoin spot ETF experiencing continuous outflows, attributed to early investors looking to cash out due to Bitcoin’s price surge and the fund’s higher management fee. Internationally, Swiss and Canadian crypto funds have also experienced outflows, with Canada’s Purpose Bitcoin ETF losing over 20% of its Bitcoin since the launch of equivalent products by BlackRock and Fidelity. Short Bitcoin investment products and Ethereum funds have seen consecutive outflows, with Ethereum yet to receive its own spot ETF amidst growing skepticism about the current round of applications being approved by May.
