TradFi Investors Piled $38.7B Into Bitcoin ETFs, Three Times More Than Previous Quarter

Institutional Investors Flock to Bitcoin ETFs, Despite Volatility

Large Institutions Triple Their Holdings of Spot Bitcoin ETFs in Q4 2024

According to recent 13F filings with the Securities and Exchange Commission (SEC), large institutions such as pensions and hedge funds have continued to invest in spot bitcoin exchange-traded funds (ETFs), despite the cryptocurrency’s volatility. The data reveals that institutional investors with assets over $100 million are required to report their holdings each quarter.

Spot Bitcoin ETF Holdings Triple in Q4 2024

According to Bitwise chief investment officer Matt Hougan, institutional investors purchased $38.7 billion worth of spot bitcoin ETFs in the fourth quarter of 2024, a significant increase from the $12.4 billion reported in the previous quarter. This surge in investment highlights the growing interest in the cryptocurrency market among institutional investors.

Hedge Funds and Pension Funds Lead the Charge

Several hedge funds and pension funds, including the State of Wisconsin’s investment board, have started buying the funds since January 2024, when the bitcoin ETFs were first launched. The State of Wisconsin’s investment board, for example, boosted its holdings to just over 6 million shares of BlackRock’s iShares Bitcoin Trust (IBIT) as of December 31.

Other notable investors, such as billionaire hedge fund manager Paul Tudor, have also increased their stake in IBIT. Tudor nearly doubled his holdings to 8,048,552 shares, up from 4,428,230. Corvex Management, an asset management firm founded by investor Keith Meister, also disclosed holding more than a million shares in IBIT at the end of the fourth quarter.

Record-High Number of Institutional Holders

According to Bloomberg Intelligence senior ETF analyst Eric Balchunas, IBIT currently has 1,100 institutional holders that have reported their stake via 13F filings. This is a record high for a newly launched ETF, with most new ETFs typically having under 10 holders.

Why the Surge in Institutional Investment?

The surge in institutional investment in bitcoin ETFs can be attributed to the growing acceptance of the cryptocurrency as a viable asset class. As the market becomes more mainstream, institutional investors are becoming more comfortable allocating a portion of their portfolio to bitcoin and other cryptocurrencies.

Conclusion

The trend towards institutional investment in bitcoin ETFs is likely to continue, driven by the growing acceptance and mainstreaming of the cryptocurrency. As the market becomes more mature, we can expect to see even more institutional investors allocating a portion of their portfolio to the asset class.

FAQs

Q: Why are institutional investors investing in bitcoin ETFs?
A: Institutional investors are investing in bitcoin ETFs due to the growing acceptance and mainstreaming of the cryptocurrency, as well as the potential for long-term returns.

Q: What is the current number of institutional holders for IBIT?
A: According to Bloomberg Intelligence, IBIT currently has 1,100 institutional holders that have reported their stake via 13F filings.

Q: What is the record high number of institutional holders for a newly launched ETF?
A: The record high number of institutional holders for a newly launched ETF is around 350, with IBIT currently surpassing this number with 1,100 institutional holders.

Q: What is the total amount of spot bitcoin ETFs purchased in Q4 2024?
A: According to Bitwise chief investment officer Matt Hougan, institutional investors purchased $38.7 billion worth of spot bitcoin ETFs in the fourth quarter of 2024.