Bitcoin ETF assets more than halfway to surpassing gold funds

As bitcoin ETFs continue to see net inflows and BTC’s price rises, the assets moving into such funds have reached more than half of those in the gold ETF category.

The 10 US spot bitcoin ETFs have eclipsed the $50 billion assets under management mark — reaching about $52.5 billion on Monday, according to BitMEX Research data.

The Grayscale Bitcoin Trust (GBTC) ported over roughly $28 billion in assets upon converting to an ETF on Jan. 11. That means the segment’s asset level has nearly doubled in seven weeks — due to $7.9 billion of net inflows and the price of the funds’ underlying bitcoin going up.

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GBTC’s assets recently returned to $28 billion in assets due to recent BTC price appreciation, despite the fund’s nearly $9.3 billion of net outflows to date.

The Grayscale fund continues to lead the bitcoin ETF segment in that category, with BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity Investments’ Wise Origin Bitcoin Fund (FBTC) holding assets worth $11.5 billion and $7.5 billion, respectively.

Physically backed gold ETFs have about $91 billion in assets, according to VettaFi data.

About $54 billion of those assets sits within State Street Global Advisors’ SPDR Gold Shares (GLD), which became the first fund of its kind in 2004.

Crypto executives and industry watchers have been quick to note that the $10 billion asset level reached by BlackRock’s IBIT in seven weeks took GLD about two years to hit.

Bloomberg Intelligence analysts have said bitcoin ETF assets under management could pass gold ETF assets within two years.

IBIT has notched inflows of nearly $8.4 billion since launching on Jan. 11, BitMEX Research data shows. Meanwhile GLD over that span has seen outflows of about $2.9 billion.

Because some refer to bitcoin as a type of digital gold, such comparisons between the asset classes have become prevalent.

Hunter Horsely, CEO of bitcoin ETF issuer Bitwise, said in a Feb. 28 X post he believes bitcoin will eat into gold’s total addressable market faster than people expect.

“Bitcoin ETFs were Bitcoin’s IPO moment,” he added in the post. “It’s now available to any investor with the click of a button. The market has 10xed.”

Still, some analysts told Blockworks last month that demand for bitcoin ETFs and gold ETFs might not be directly linked, noting that the assets represent very different investment cases.

The continued strong demand for bitcoin ETFs — with $563 million of net money flowing into the segment on Monday — comes as bitcoin’s price has approached its all-time high of about $69,000 set in November 2021.

The price of one BTC eclipsed that record briefly at about 10 am ET Tuesday, as bitcoin has risen about 20% over the past week.

Bryan Armour, director of passive strategies research at Morningstar, previously told Blockworks that “continued strong performance” would be key to bitcoin ETF assets ultimately edging money within gold funds.

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