The current $50 billion cryptocurrency-related exchange-traded fund (ETF) market may eventually be dwarfed by US-approved spot Bitcoin ETFs.
The global market for cryptocurrency exchange-traded products (ETPs) currently comprises about 150 products with $50.3 billion in assets under management, according to recent statistics.
The list tracks the performance of Ethereum and Bitcoin and covers spot and futures funds. Grayscale’s Bitcoin Trust, the biggest ETP on the list, is presently working to become a spot ETF product.
Market observers predict that the SEC’s approval of a spot Bitcoin ETF, which is expected to happen as early as January 10, will eventually double the amount of money invested in cryptocurrency ETPs.
Bitwise, a cryptocurrency investment fund, forecast on December 14 that spot Bitcoin ETFs will be the most successful ETF product ever introduced. Within the next five years, the fund expects to handle about $72 billion in assets, more than double the size of the present market.
Global investment manager Van Eck had a more realistic prediction, estimating that in the first quarter of 2024, about $2.4 billion would flow into spot Bitcoin products.
Although there has never been an authorized spot Bitcoin ETF in the United States, globally speaking, this kind of product is by no means novel. Investors can already purchase shares in spot Bitcoin exchange-traded funds (ETFs) in a number of nations, including Germany, Australia, and Canada.
The euphoria surrounding spot Bitcoin ETFs is indicative of a larger institutional investment trend in cryptocurrency investment products throughout the previous few months.
Crypto ETFs listed worldwide have drawn net inflows of $1.6 billion year to year, with $1.31 billion of that amount coming in November alone, according to a report released on December 21 by ETF research firm ETFGI. The $750 million net inflows into cryptocurrency ETPs in 2022 are almost doubled by this overall investment.
With $1.3 billion invested in the top 20 ETFs throughout the course of 2023, out of the 150 crypto funds, these funds drew the highest amount of investment.
Launched in October 2021 during a crypto bull market, the ProShares Bitcoin Strategy ETF (BITO) saw the biggest individual inflows and collected an extra $278.7 million in 2023.
