Bitcoin ETFs Bounce Back with $254 Million Inflow

Overview

On October 11, U.S.-based spot Bitcoin exchange-traded funds (ETFs) experienced a significant turnaround, recording a net inflow of $253.6 million, effectively ending a three-day streak of outflows. This surge marks one of the largest inflow days for Bitcoin ETFs, occurring even without contributions from BlackRock's iShares Bitcoin Trust (IBIT).

Leading Contributors

The Fidelity Wise Origin Bitcoin Fund led the inflows with a substantial $117.1 million. Additionally, the ARK 21Shares Bitcoin ETF followed closely, attracting $97.6 million. The Bitwise Bitcoin ETF also saw a notable increase, bringing in $38.8 million, its largest inflow in 11 trading days. Other ETFs, including those from Invesco Galaxy and VanEck, also recorded positive inflows.

In contrast, BlackRock's IBIT noted a "0" flow on this day, along with ETFs issued by Franklin Templeton, Valkyrie, and WisdomTree. Notably, this was the third-largest day of combined inflows where IBIT did not contribute.

Market Context

The $253.6 million inflow was sufficient to offset the $140 million that left Bitcoin ETFs during the preceding three days. This uptick coincided with a 7.3% rally in Bitcoin's price, reaching a local high of $63,360 before settling around $62,530, according to CoinGecko data.

Currently, BlackRock remains the leading issuer in the spot Bitcoin ETF space, boasting total net inflows of $21.7 billion. Fidelity is close behind, just $15 million shy of hitting the $10 billion milestone. Meanwhile, ARK 21Shares and Bitwise are the only other issuers with net inflows exceeding $2 billion.

Ethereum ETFs Struggle

In contrast to Bitcoin, Ethereum ETFs continue to face challenges. On October 11, seven out of nine U.S.-based spot Ether ETFs reported zero inflows, marking the third occurrence of this in the last five trading days. Collectively, the spot Ether ETFs experienced a negligible net outflow of $0.1 million, primarily due to inflows from the Fidelity Ethereum Fund. The Grayscale Ethereum Trust also saw a decline, losing $8.7 million.

The ongoing lack of demand for Ether ETFs has been attributed to their launch timing, as noted by Bitstamp's CEO for the Americas, Bobby Zagotta. He highlighted that market participants are currently in a "wait-and-see" mode due to various uncertainties, including upcoming elections and regulatory concerns. There is also skepticism about Wall Street's understanding of Ethereum's complex roadmap, which complicates investor sentiment regarding its value.

Conclusion

The recent rebound in Bitcoin ETF inflows signals renewed investor interest, particularly in light of recent price rallies. However, the contrasting struggles of Ethereum ETFs reflect broader market hesitations and uncertainties. As the landscape evolves, both Bitcoin and Ethereum products will likely continue to navigate fluctuating demand and investor sentiment.