Bitcoin - ETFs Approach a Symbolic Threshold

Despite Bitcoin’s decline in the second quarter, institutions have not stopped buying it. They now hold nearly …

ETFs Still in Vogue

Bitcoin ETFs continue to flourish. They absorbed $252 million on just last Friday alone. That was the day of the “dovish” speech of Fed Chairman Jerome Powell at Jackson Hole.

The weekly total amounted to $506 million. It was the best week in a month. More than $200 million were added this Monday.

It’s quite simple, BlackRock’s Bitcoin ETF features the third-largest capital inflow among thousands of global ETFs. Its BTC stock represents more than $20 billion.

In total, ETFs have collected more than $18 billion since their launch (net). Up 32% over the last three months:

Total investi dans les ETF Bitcoin (en million de dollars). pic.twitter.com/ltnUg7nwYN

— Nicolas Teterel (@NTeterel) August 27, 2024

ETFs now hold 922,000 BTC. At this rate, the symbolic threshold of a million BTC will be reached in a few months and 22,000,000 BTC in about twenty years…

In contrast, Ethereum ETFs are a disaster. While Bitcoin ETFs had sucked in $2.8 billion during the first month of listing, Ethereum ETFs experienced a hemorrhage of $460 million.

This negative figure is possible due to the preexistence of Grayscale’s ETH ETF. Incidentally, even the Ethereum foundation took advantage of the euphoria to sell the equivalent of $100 million in ETH. Ethereum is down 34% against Bitcoin in the past year.

All these numbers are interesting, but knowing who is buying is also rich in insights. This is revealed by the list of Bitcoin ETF holders communicated once a quarter.

Who Buys Bitcoin?

We have this information thanks to Form 13F. This is a document that must be filed by institutions managing more than $100 million in assets.

Note that NYDIG has reorganized its investor classification system for greater clarity.

“These adjustments will allow us to avoid misleading headlines such as ‘Goldman Sachs owns Bitcoin ETFs,’ which is technically true, but only within the framework of their brokerage activity and probably as a market maker, not within their investment advisory services,” as stated in the NYDIG report.

It turns out that even though Bitcoin ended the second quarter down, all major holder categories still loaded up:

Évolution des investissements dans les ETF Bitcoins par les institutionnels au second trimestre.

Le bitcoin ayant baissé au T2, les chiffres sont trompeurs. Reportez-vous à la colonne "Fund flows" pour les flux nets. pic.twitter.com/jSRX0QnaQJ

— Nicolas Teterel (@NTeterel) August 27, 2024

The “non-filers” category corresponds to all entities managing less than $100 million. These are retail investors. They hold the majority of ETF shares (78%).

The reduction in their total dollar position, from $47.6 billion to $40.8 billion, is only related to the decline in Bitcoin. They have actually remained buyers by investing $637.5 million, accounting for a quarter of the total inflows into ETFs for the second quarter.

With a net purchase of $1.1 billion, investment advisors remain loyal promoters of Bitcoin. The amount of Bitcoin ETF shares held by investment advisors increased to $4.3 billion at the end of June.

Finally, let’s recall that the public pension fund of the State of Wisconsin made headlines when the first list of Bitcoin ETF investors was published. Unfortunately, this good surprise did not spark a larger wave of allocations from pension funds.

We will need to closely monitor the evolution of this list in Q3 now that Donald Trump has pledged allegiance to Bitcoin.