Bitcoin ETFs Bounce Back With $45M Inflows, Morgan Stanley Opens Doors to Clients

• Bitcoin ETFs saw outflows totaling over $550 million across three consecutive trading days.
• Morgan Stanley’s 15,000 advisors can now offer BlackRock and Fidelity BTC ETF products to wealthy clients.
• “Fear” may be gripping institutional investors, although ETF trading volumes remain high amid a market downturn.

U.S. spot Bitcoin (BTC) exchange-traded funds (ETFs) have broken a three-day outflow streak, posting modest inflows as crypto and ETF markets wrestle for stability.

Meanwhile, investment banking behemoth Morgan Stanley has told its thousands of financial advisors that they can begin offering Bitcoin ETFs to their clients.

Bitcoin ETFs

As per data from SoSoValue , Bitcoin ETFs have seen a rather steep decline in overall activity. Despite this, they have managed to break a three-day losing streak with net inflows of $45.14 million.

BlackRock’s iShares Bitcoin Trust (IBIT) was back up top today, posting a solid $52.52 million in net inflows. This brings its cumulative net inflows to $20.15 billion.

Since launching, the WisdomTree Bitcoin Trust (BTCW) has seen its largest net inflows, bagging a credible $10.5 million. Between June 4 and Aug. 4, 2024, BTCW saw just one day of inflows following weeks of neutral flows. BTCW is the second-smallest fund, with $82.82 million in net assets.

Grayscale Bitcoin Trust (GBTC) stayed true to the outflow course, with exits totaling a modest $30.58 million. Of course, Grayscale’s never-ending outflows disproportionately affected these results.

In recent months, GBTC’s outflow sores have begun to heal considerably, and it hasn’t posted daily outflows exceeding $100 million since June 11.

Until April, GBTC regularly recorded outflows  of hundreds of millions. Its worst single day of exits amounted to $642.52 million in mid-March. Since mid-June, GBTC has experienced outflows averaging around $50 million, with the occasional day of neutrality and the rare net inflow.

Stability or Underperformance?

Now that Bitcoin ETFs have just over six months’ worth of trading under their belts, it would appear that the inflow and outflow rates have apparently “relaxed” to some degree.

Looking at volumes, the $1.79 billion that traded on Aug. 7 is more than that of July 22, when volumes of $1.62 billion netted a whopping $485.88 million in net inflows. As ETF analyst Eric Balchunas  noted, high volumes on down days are a “pretty reliable measure of fear.”

Conversely, he notes that it is also a sign of deep liquidity, which is what investors and traders “love about ETFs” as it is a good sign for the long term.

Looking at GBTCs slowing outflows, overall lower volumes among all issuers, lower-than-average net inflows, and a market downturn, ETF issuers could be bracing for a rocky period. That said, Morgan Stanley seems to approve  of the crypto ETF market.

Morgan Stanley Approves

In rather bullish news, Morgan Stanley’s 15,000 wealth managers have officially begun recommending two Bitcoin ETFs to qualified clients. On Aug. 7, Morgan Stanley’s army of financial advisors was granted permission to offer BlackRock’s IBIT and Fidelity’s FBTC to clients.

This is considered a watershed moment for crypto overall, as not only is it a first for a big bank, but also that it commands some $1.25 trillion in assets under management (AUM). In the near future, Ethereum ETF products could receive the same approval. It’s also likely that other financial behemoths like Wells Fargo will follow in Morgan Stanley’s footsteps.

About the Author

Eddie Mitchell

Eddie has been writing news and content primarily for crypto news and industry players over the past seven years. With an eye for the bigger picture, Eddie prefers to investigate the broader implications of a story, as well as explore the weird and wonderful world of crypto. He believes blockchain has already changed the world, but observes the space overall with a skeptical and adoring eye.

See more

[email protected]