BlackRock's Bitcoin ETF Halt Sparks Concern Amid Still-Growing U.S. BTC Holdings
Summary:
BlackRock's iShares Bitcoin Trust (IBIT), the fastest-growing spot Bitcoin ETF in the U.S., has seen no capital inflows since April 24, a situation virtually unheard of since its inception. This halt, marking the end of a 71-day inflow streak, has sparked concerns and debates within the Bitcoin community. Despite this slowdown, U.S. spot Bitcoin ETFs overall remain in positive territory, having seen their collective holdings increase approximately by 33.1% since their launch.
In recent days, BlackRock's spot Bitcoin exchange-traded fund (ETF) - the iShares Bitcoin Trust (IBIT), has raised eyebrows in the Bitcoin (BTC) circles as it reported no new capital inflow. This circumstance is quite unusual considering how IBIT has prospered as the fastest-growing spot Bitcoin ETF in the USA, since its inception with no inflow halts until April 24 of this year.
The latest data from IBIT's official page reveals that the number of BTC held by the fund remains at 274,462 for the past four trading days. Indeed, these statistics mark a break in IBIT's 71-day capital inflow conclusion, leading to some concerns within the community. Until this point, the fund has seen daily investments allowing it to grow from modest holdings of 2,621 BTC at the outset on January 11, to an impressive 10,378% increase in its holdings by now.
While some crypto-enthusiasts worry about what this halt means for investors, others suggest that the continuous 71-day inflow streak was more exceptional than the current stagnation period. Explaining the situation, Apollo’s co-founder Thomas Fahrer stated that the actual movement of Bitcoins into or out of an ETF relies heavily upon the disparity between the supply and demand. He further clarified that this situation is standard for all ETFs, not specific to Bitcoin and most ETFs record zero inflows on most days.
The notable lack of new investments in BlackRock's fund coincides with continued outflows from other spot Bitcoin ETFs, such as the largest market player, Grayscale Investments. As per recent data provided by HODL Capital, as of April 20, the total outflows from 10 complementary spot Bitcoin ETFs in the United States peak at 823 BTC. Grayscale's fund drops to about 52% from the starting holdings on January 11, with its current BTC holding tally standing around 8% superior to BlackRock's.
However, despite the slowed inflows, spot Bitcoin ETFs in the United States still demonstrate positivity in terms of changes in total holdings since their launch. Figures suggest that, as of April 29, these entities hold a collective 831,424 BTC, marking an approximate 33.1% increase since January 11.
Published At
4/30/2024 5:06:46 PM
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