BTC ETF Inflows Soar 400%, What's Next?

Source: Blockchain Knight

The U.S. BTC and Spot Ethereum ETFs have recently generated new inflows, indicating that market sentiment may have changed somewhat.

The BTC ETF saw significant investment flows on September 10, thus avoiding continuous withdrawals. The Ethereum ETF also halted five consecutive days of outflows, although it had different issues.

These inflows come at a time when institutions are on the sidelines on crypto assets, and Ethereum appears to be losing dominance even as BTC attracts more funds.

Coupled with global Crypto asset ownership statistics, it paints a complex picture for future market trends.

Data shows that Spot BTC ETF attracted nearly US$117 million on September 10, an increase of 400% from US$37.29 million the previous day.

This follows eight consecutive days of withdrawals, which reduced total assets under management by more than $1.18 billion.

Fidelity’s FBTC led the way with inflows of $63 million for two consecutive days, followed by Grayscale BTC Mini Trust and ARK 21Shares with inflows of $41 million and $12.7 million respectively.

The total trading volume of the 12 BTC ETFs fell to US$712 million from US$1.61 billion the previous day, a drop of 55%.

While inflows look promising, the sharp decline in trading activity does warrant caution among investors.

Interestingly, these numbers coincide with the "2024 Global Crypto Asset Status Research Report" released by Gemini.

The survey shows that the Crypto asset holding rate in France surged from 16% to 18%, while the Crypto asset holding rates in the United States and the United Kingdom were 21% and 18% respectively. In comparison, Singapore's ownership ratio fell slightly, from 30% to 26%.

While the situation with the Ethereum ETF is less clear, the BTC ETF has shown strong liquidity.

On September 10, the spot Ethereum ETF saw a net inflow of US$11.4 million, thus breaking the five consecutive days of massive outflows.

Fidelity’s FETH led the way with inflows of $7 million, and BlackRock’s ETHA ranked second with $4.3 million.

However, the remaining seven Ethereum ETFs did not experience capital inflows.

While these inflows are positive, Ethereum still faces further difficulties. Wisdom Tree withdrew its application for a spot Ethereum ETF to the U.S. Securities and Exchange Commission after Van Eck announced the closure of its Ethereum strategy ETF.

To date, Ethereum ETF has experienced a cumulative net outflow of $562 million. These actions indicate a decline in institutional confidence in Ethereum-based products.

The development of Crypto assets around the world shows various models. While Crypto asset ownership remains high in large markets such as the United States and the United Kingdom, there are signs of declining interest in some regions such as Singapore.

The market’s recovery depends on the persistence of long-term investors, so Gemini’s research highlights that these factors, in addition to regulatory developments and spot ETFs, may also drive future expansion.