Bitcoin ETFs See Strong Return with $1.9 Billion in Inflows After December Slump

Spot Bitcoin exchange-traded funds (ETFs) in the United States experienced a dramatic reversal in early January 2025, attracting nearly $1.9 billion in total net inflows on January 3 and January 6. This surge followed a period of disappointing demand in the latter half of December 2024, which had seen outflows in six of the last eight trading days of the year.

On January 6, Bitcoin ETFs saw $978.6 million in inflows, with the Fidelity Wise Origin Bitcoin Fund leading the charge, pulling in $370.2 million. Other major funds, including BlackRock’s iShares Bitcoin ETF and the ARK 21Shares Bitcoin ETF, contributed significant amounts, with $209 million and $153 million, respectively. According to Farside Investors, the inflows were spread across several key ETFs, with Bitwise’s Bitcoin ETF and Grayscale’s two spot Bitcoin ETFs—tickered GBTC and BTC—receiving more than $70 million combined. The VanEck Bitcoin ETF and Franklin Bitcoin ETF also saw positive flows, raking in $17.3 million and $8.9 million, respectively.

Despite these gains, not all Bitcoin ETFs were as fortunate. Products from Invesco, Valkyrie, and WisdomTree reported zero inflows on January 6, highlighting the varying levels of investor interest across the sector.

The robust inflows on January 3 and 6 almost entirely offset the $1.9 billion in net outflows recorded between December 19 and January 2. This recent uptick brings the total net inflows into U.S.-based spot Bitcoin ETFs to $36.9 billion since the products launched nearly a year ago.

BlackRock Leads the Pack, Grayscale Struggles

As of January 2025, BlackRock’s iShares Bitcoin ETF is the standout performer, with $37.4 billion in net inflows, the highest of any spot Bitcoin ETF. The Fidelity Wise Origin Bitcoin Fund follows with $12.4 billion in inflows. In contrast, Grayscale’s converted GBTC (Grayscale Bitcoin Trust) has seen a significant outflow of $21.4 billion, underlining the challenges faced by older Bitcoin products compared to newer ETF offerings.

A report from cryptocurrency exchange Binance in late October 2024 revealed that nearly 80% of the demand for spot Bitcoin ETFs had come from retail investors, rather than institutions. However, industry experts predict that institutional involvement will rise in 2025, as more clearinghouses for spot Bitcoin ETF trading are expected to come online. This anticipated shift in investor demographics is one of the key drivers behind bullish forecasts for Bitcoin's future price.

Bitwise’s Chief Investment Officer, Matt Hougan, has expressed confidence in a $200,000 Bitcoin price target for 2025, while VanEck predicts Bitcoin could reach as high as $180,000 in the same timeframe.

Looking Ahead

The recent surge in Bitcoin ETF inflows signals renewed interest in Bitcoin as an investment vehicle, following a turbulent period at the end of 2024. With retail investors continuing to dominate, and institutional participation expected to increase, the future of spot Bitcoin ETFs looks promising. As more capital flows into these products and new infrastructure supporting Bitcoin trading develops, the stage may be set for another year of growth and volatility in the Bitcoin market.