U.S. Bitcoin ETFs Surpass $100 Billion in Assets, Poised to Overtake Gold ETFs

Bitcoin exchange-traded funds (ETFs) in the United States have crossed a significant milestone, with total assets surpassing $100 billion for the first time on November 21, according to Bloomberg Intelligence. With current assets nearing $104 billion, Bitcoin ETFs are now on track to surpass gold ETFs, which hold approximately $120 billion in assets.

This impressive growth comes amid a surge in investor interest, particularly following the victory of crypto-friendly President-elect Donald Trump in the U.S. elections. The boost in Bitcoin's performance, fueled by a positive outlook for the cryptocurrency after Trump's win, has led to an influx of over $5 billion into Bitcoin ETFs in recent weeks, according to Bryan Armour, director of passive strategies research at Morningstar.

Bitcoin ETFs Surge After Launch of Spot BTC Products

Bitcoin ETFs have been at the forefront of the cryptocurrency investment landscape since the launch of spot Bitcoin ETFs in January. These products have rapidly gained traction among investors looking to gain exposure to Bitcoin without directly purchasing the cryptocurrency. The total assets in Bitcoin ETFs are growing at an extraordinary pace, and they now account for nearly 97% of the way toward surpassing Satoshi Nakamoto, the pseudonymous creator of Bitcoin, as the largest holder of the cryptocurrency, according to Bloomberg’s Eric Balchunas.

Among the most popular Bitcoin ETFs, BlackRock’s iShares Bitcoin Trust (IBIT) leads the charge, pulling in a staggering $30 billion in net inflows since its launch in January. The Fidelity Wise Origin Bitcoin Fund (FBTC) has also garnered significant interest, attracting over $11 billion in inflows in 2024, according to Bloomberg data.

Surge in Bitcoin Price Drives ETF Growth

A major factor driving the growth of Bitcoin ETFs has been the sharp rise in Bitcoin’s price. As of November 21, Bitcoin’s spot price reached over $96,000, up nearly 120% since the start of 2024, according to Google Finance data. This surge has intensified following the November 5 U.S. presidential election, with many investors speculating that Trump's victory would benefit the cryptocurrency market.

On November 6, BlackRock’s IBIT saw its highest trading volume ever, as investors flocked to cryptocurrencies in the wake of Trump's win. The very next day, IBIT recorded $1.1 billion in inflows, recovering quickly after two consecutive days of outflows. These inflows reflect the growing confidence in the future of Bitcoin as an asset class.

Bitcoin ETFs Outperforming Gold

The rapid growth of Bitcoin ETFs has put them on track to surpass gold ETFs in total assets. As of November 21, Bitcoin ETFs collectively manage approximately $104 billion, just $16 billion short of gold ETFs, which hold around $120 billion in assets. BlackRock’s IBIT, which launched just this year, has already accumulated more assets than the asset manager’s gold ETF, a remarkable feat given the short time frame.

The performance of Bitcoin ETFs is also reflective of a broader trend in the financial markets. Investors are increasingly turning to Bitcoin and gold as safe-haven assets in what’s being described as a “debasement trade.” With rising geopolitical tensions and fears of economic instability, many investors are seeking assets that can protect against potential currency devaluation or systemic risks.

Bitcoin’s Future Outlook

Looking ahead, analysts are predicting a strong future for Bitcoin. MV Global forecasts that Bitcoin’s price could range from $100,000 to $150,000 per coin in the coming months, further driving interest in Bitcoin ETFs. As more institutional and retail investors flock to these ETFs, Bitcoin’s role in the global financial landscape continues to evolve, with its growing market share putting it in direct competition with traditional assets like gold.

In summary, U.S. Bitcoin ETFs have made significant strides, surpassing $100 billion in assets and showing no signs of slowing down. With Bitcoin’s price rising and investor sentiment shifting, these funds are poised to continue their ascent, potentially overtaking gold ETFs in the near future. As Bitcoin ETFs gain traction, they reflect a broader shift in investor preferences and the increasing mainstream acceptance of cryptocurrencies.