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Bitcoin ETFs: Inflows Outpace Mining by More Than 10 Times

Last Updated February 13, 2024 9:42 AM
Teuta Franjkovic
Last Updated February 13, 2024 9:42 AM

Key Takeaways

  • Demand for spot Bitcoin ETFs outpaced new coin creation by miners by 10x in recent days.
  • BlackRock’s iShares Bitcoin Trust absorbed the largest share of inflows.
  • Anthony Pompliano highlights most of Bitcoin being “inactive”.

Spot Bitcoin ETFs have experienced a rapid surge, surpassing the creation of new Bitcoin by miners by more than ten times in recent trading sessions.

Based on initial data , approximately $493.4 million, equivalent to about 10,280 Bitcoin, was invested in spot Bitcoin ETFs up to February 12.

BlackRock Drives Huge Bitcoin ETF Inflows

BlackRock’s iShares Bitcoin Trust dominated the inflow of funds, receiving a substantial $374.7 million. In comparison, Fidelity’s Wise Origin Bitcoin Fund attracted $151.9 million, and the Ark 21Shares Bitcoin ETF garnered $40 million. However, these inflows were slightly balanced out by outflows of $95 million from Grayscale and $20.8 million from the Invesco Galaxy ETF, though the net inflows still approached nearly half a billion dollars.

On Monday, February 12, Bitcoin miners generated  approximately 1,059 BTC, valued at around $51 million, based on data from Blockchain.com. This production represents just 10% of the amount of BTC absorbed by spot ETFs.

On February 9, a comparable trend was observed, with about 12,700 BTC or $541.5 million worth of the asset collectively flowing into ETFs, in contrast to the 980 BTC worth approximately $45 million that was added to the market through mining.

BTC supply growth
Credit: Blockchain.com

Massive Inflows into Bitcoin ETFs: BlackRock Takes the Lead

BlackRock spearheaded the inflows with a significant $250.7 million, followed closely by Fidelity with $188.4 million. Ark 21Shares also experienced substantial inflows, amassing $136.5 million. In contrast, Grayscale saw its outflows decrease to the week’s lowest level at $51.8 million, contributing to a remarkable day of overall net inflows.

In related news, Bitcoin advocate Anthony Pompliano remarked , “Wall Street loves Bitcoin,” during a CNBC’s Squawk Box interview on February 12.

He said :

“There is 12.5x more demand for Bitcoin than what is being produced on a daily basis.”

Pompliano further noted  that approximately 80% of Bitcoin’s total supply has remained stationary for the past six months. He elaborated that only about $200 billion worth of BTC is available for trading, highlighting the significant impact of these ETFs, which have absorbed 5% of the entire tradable supply of Bitcoin in just 30 days.

Bitcoin ETFs Hit Over $1 Billion in Daily Trading Volume

Just a few days ago, on February 7, the daily trading volume for spot Bitcoin ETFs soared past the billion-dollar mark , with BlackRock’s offering leading the surge.

James Seyffart, an analyst at Bloomberg Intelligence, highlighted  this as a significant day for trading volumes, particularly for BlackRock’s iShares Bitcoin Trust (IBIT), which recorded a daily trading volume of $341.2 million. This figure surpassed that of the Grayscale Bitcoin Trust, which saw a volume of $296.5 million, according to Seyffart.

Fidelity’s FBTC fund ranked third with a $200 million trading volume, while the combined daily volume of the remaining seven funds amounted to $188 million, cumulatively exceeding a billion dollars for the day.

Despite this milestone, Seyffart remarked  that reaching the $1 billion mark “isn’t that big of a deal” for Bitcoin ETFs. He noted that while it represented an increase from recent days, it was still well below the trading volumes seen in the first couple of weeks after their introduction.

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