Bitcoin ETF Debut Week Showdown: BlackRock and Fidelity Lead With $1 Billion Inflow,

  • Bitcoin ETFs made a grand entrance in its debut week, attracting $1.5 billion in new capital. 
  • BlackRock and Fidelity led the pack, bringing in over half of the new capital. 
  • While most ETFs celebrated positive inflows, Grayscale, a veteran in the industry, was caught in a riptide. 

Bitcoin ETFs had a monster start from the get-go when they began trading on Thursday, January 11. Leaving ETF records in tatters, the financial product sent shockwaves through the industry, reeling in billions within two days of trading– a testament to the growing demand for Bitcoin. 

Leading the charge in the crypto frenzy were heavyweights BlackRock and Fidelity, hauling in more than half of the cash flooding into Bitcoin ETFs, but at the expense of another issuer

Bitcoin ETFs’ Grand Debut

After weathering months of anticipation, uncertainty, and rejections– 20 to be exact—Bitcoin ETFs have finally stepped into the spotlight. Making its grand entrance onto the stock market on Thursday, the ETFs have sparked excitement across both TradFi and the crypto industry, already translating into impressive figures in just two days. 

Since gaining approval, Bitcoin ETFs have attracted nearly $1.5 billion in new capital through 500,000 trades over two days, according to preliminary data from Bloomberg senior analyst Eric Balchunas. 

BlackRock’s bitcoin ETF led the pack, which brought in nearly half a billion in capital within the first two days of trading, presumably due to its slashed fee. Trailing behind was Fidelity’s ETF, securing $422 million in inflows, while Bitwise claimed the third spot with $237 million. 

What’s impressive about BlackRock’s spell is that it debuted with over a billion dollars of volume on its first day of trading, marking one of the biggest launches for an ETF in History. However, while most ETFs reveled in positive inflows, Grayscale, in contrast, bore the brunt with mounting outflows exceeding $579 million.

Bitcoin ETF Investors Move from Grayscale

Despite boasting extensive experience in traditional finance, most Bitcoin ETF issuers are relatively newcomers to the crypto industry and were initially hesitant to dive into it. 

At one time, BlackRock CEO Larry Fink dismissed the industry as a mere scam, and now he claims it to be the greatest asset class of the 21st century. 

Compared to the other issuers, Grayscale stands out as a veteran, having operated a $27 billion bitcoin trust since 2013, which later converted into an ETF. However, what hindered its success in the recent Bitcoin ETF hype was its 1.5% fee. 

In stark contrast, BlackRock and Fidelity, which pulled in nearly $1 billion in inflows, each sport a competitive fee of 0.2%. The allure of these fees has triggered a notable shift among investors, pivoting from GBTC to embracing a more cost-effective investment alternative following the ETF approval. 

On the Flipside

  • Following the success of the Bitcoin ETFs, European investment firm CoinShares recently acquired Valkyrie Funds, one of the eleven Bitcoin ETF issuers. 
  • While Bitcoin ETFs reel in billions, Bitcoin, on the other hand, plummeted to $42,000 after peaking at $49,000. 

Why This Matters

With Bitcoin ETFs here to stay and given the initial investor reaction, this is only the start of a promising trajectory for the crypto and financial industries.

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