Bitcoin exchange-traded funds (ETFs) are once again generating excitement among investors, with a recent surge in capital inflows and a flurry of new applications. ProShares' Bitcoin Strategy ETF (BITO), a Bitcoin futures fund, recently experienced its largest weekly inflow in a year, totaling $65.3 million. This article explores the resurgence of institutional investors' interest in Bitcoin futures and the growing competition among ETF issuers seeking approval from the Securities and Exchange Commission (SEC).
BITO's Strong Performance and Popularity:
As the first Bitcoin-linked ETF in the United States, BITO has garnered significant attention from institutional investors. Bloomberg senior ETF analyst Eric Balchunas highlights BITO's impressive tracking of Bitcoin prices, lagging spot prices by a mere 1.05% annually. The fund currently manages assets exceeding $1 billion and charges a 0.95% fee. Since the beginning of 2023, BITO has delivered a noteworthy gain of 59.6%, solidifying its appeal to investors.
Derivatives Interest Surges After BlackRock's Move:
The interest in Bitcoin derivatives has experienced a notable uptick following BlackRock's filing for its Bitcoin ETF on June 15. This move has reignited hopes for the approval of a spot Bitcoin ETF by the SEC, prompting a fresh wave of applications from various issuers. While it remains uncertain whether the SEC will greenlight a spot Bitcoin ETF, the race to secure approval is underway.
A Competitive Field Emerges:
Following BlackRock's filing, other industry players have swiftly submitted their own applications for a spot Bitcoin ETF. WisdomTree has filed for a spot Bitcoin ETF for the third time, showcasing its determination to bring this product to market. In addition, Invesco has renewed its application for a similar ETF, signaling its commitment to entering the space.
ETF Store President Nate Geraci's Insight:
Nate Geraci, President of ETF Store, has identified several ETF issuers that he believes will likely file or refile for a spot Bitcoin ETF based on their past filings. Geraci's list includes First Trust, VanEck, Global X, Fidelity, and Schwab, which he refers to as the "dark horse." These issuers are closely watched by industry observers as they navigate the evolving regulatory landscape in their pursuit of a Bitcoin ETF.
Conclusion:
The resurgence of Bitcoin ETF fever is evident through the recent inflows into ProShares' BITO, the first Bitcoin futures fund in the US. Institutional investors are once again expressing their interest in Bitcoin derivatives, drawn by the strong performance and potential of these investment vehicles. With a renewed wave of applications following BlackRock's move, the competition to gain approval for a spot Bitcoin ETF has intensified. As the SEC evaluates these applications, the market eagerly awaits a decision that could have a significant impact on the future of Bitcoin investment opportunities.