Home Crypto News News Spot Bitcoin ETFs Present $100B Opportunity, Pumping Demand for Existing Crypto Funds

Spot Bitcoin ETFs Present $100B Opportunity, Pumping Demand for Existing Crypto Funds

James Morales
Last Updated November 20, 2023 4:01 PM
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Key Takeaways

  • Bloomberg estimates that the market for spot bitcoin ETFs is worth $100B.
  • The expectation that ETF approval is imminent has boosted existing crypto investment products.
  • Funds and trusts that track digital asset prices have recorded net inflows for 8 weeks in a row.

Judging from the behavior of major fund managers, the arrival of spot Bitcoin Exchange Traded Funds (ETFs) in the U.S. is almost inevitable

But assuming they are approved by the U.S. Securities and Exchange Commission (SEC), just how high could ETF inflows go? According to the latest estimate from Bloomberg, the market could be worth $100B. 

Wall Street To Drive Next $100B Of BTC Investment

For the best part of the last year, ETF hype has been one of the most important factors influencing the price of Bitcoin.

According to the generally accepted wisdom, once ETFs managed by Wall Street giants like Blackrock and Fidelity are given the green light to invest directly in Bitcoin, it will open the door to institutional investors who have been reluctant to hold the asset themselves. 

Without giving a timeframe, on Monday, November 20, a Bloomberg report said the spot Bitcoin ETF market “has the potential to grow into a $100 billion juggernaut.”

As evidence of institutional appetite, the report cited a recent call Galaxy Digital held with roughly 300 investment professionals. It went on to quote one such investment manager, Summit Wealth’s Jeff Janson, who said “I feel like we are now staring down the gun barrel of the SEC finally delivering approval.” 

“My belief is that once you have access to it in that type of a wrapper, I think you’re going to have a significant amount of institutional-level interest,” Janson observed.

If ETFs do come to attract $100B of investment, they will become some of the largest Bitcoin holders in existence.

Already, the Grayscale Bitcoin Trust is the 2nd largest BTC-holder in the world, holding more than $16B worth of the cryptocurrency. And in recent weeks, Grayscale and other crypto investment specialists have benefited from rising interest in the asset class.

Crypto Investments See 8 Weeks Of Continuous Inflows

According to data  collected by CoinShares, digital asset investment products saw inflows totaling $176M last week, marking the 8th consecutive week of net inflows.

Coinshares crypto fund inflows/outflows
  Weekly crypto inflows/outflows

“We believe this continued positive sentiment is related to the imminent approval of a spot-based Bitcoin ETF in the U.S.,” the asset manager noted.

Bitcoin continues to dominate the market, driving over $700M to exchange-traded products since the beginning of November. So far this year, investors put over $1.24B in trusts and funds that track the price of BTC.

The strong demand for Bitcoin-based investment products in October and November contrasts with a period of sustained outflows in July–September .

Meanwhile, Solana funds have recorded net inflows nearly every week since mid-July, the CoinShares report shows.

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