The cryptocurrency market is buzzing with anticipation as a major asset manager, Bitwise, predicts a significant influx of institutional capital into spot Bitcoin exchange-traded funds (ETFs) by June 2024.
Bitwise, known for its focus on crypto-native investment solutions, revealed this information in a recent investor memo. Their Chief Investment Officer, Matt Hougan, highlighted ongoing “serious due diligence” discussions with large corporations, major wirehouses (financial advisors affiliated with large investment firms), and institutional consultants. These discussions indicate a growing appetite for Bitcoin exposure among these key players.
Hougan further emphasized that a diverse range of individual investors, family offices, hedge funds, and venture capital firms have already begun accumulating positions in spot Bitcoin ETFs. This early adoption signifies a broader trend of investor confidence in the digital asset class.
Analysts credit the surge in institutional interest with the significant price increase experienced by Bitcoin since the launch of spot Bitcoin ETFs in January 2024. At the time of writing, Bitcoin sits at $68,583, reflecting a remarkable rise of over 50% from its pre-ETF price of $45,603.
Bitwise predicts this trend to accelerate in the coming months. While spot Bitcoin ETFs have already garnered nearly $9 billion in net inflows, Hougan anticipates a further increase as these new investment vehicles gain wider acceptance.
“These are massive categories representing trillions of dollars in assets,” Hougan stated. He expressed confidence that significant investments from large corporations, major wirehouses, and institutional consultants will begin flowing into spot Bitcoin ETFs during the second quarter of 2024, potentially escalating throughout the year.
This aligns with Hougan’s previously expressed bullish sentiment towards Bitcoin ETFs. In late February, he predicted an even “bigger wave” of institutional capital, suggesting a subsequent rise in Bitcoin’s price.
Data from BitMEX Research confirms Hougan’s observations. Spot Bitcoin ETFs have attracted a staggering $8.89 billion in net inflows since their launch, with BlackRock’s iShares IBIT fund leading the pack.
Further emphasizing the growing institutional interest, BlackRock’s Bitcoin ETF surpassed business intelligence giant MicroStrategy in terms of total Bitcoin holdings on March 8th. The iShares IBIT fund boasts 197,943 BTC on its balance sheet, with a current market value exceeding $13.5 billion.
Commenting on the rapid growth of Bitcoin ETF inflows, Bloomberg ETF analyst Eric Balchunas described the figures as “bananas numbers for ETFs under [two months] old.” This sentiment reflects the surprise and excitement surrounding the unprecedented pace of adoption.
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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.
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