Spot Bitcoin ETF Issuers Amass Over 10,000 BTC Amid Price Fluctuations
The nine spot Bitcoin ETF issuers have bought over 60,000 BTC since trading started. But BTC price continues to suffer due to outflows from GBTC
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Most spot Bitcoin exchange-traded funds (ETFs) issuers continue accumulating more Bitcoins to match inflows despite the decline in BTC. With this, the firm joins stablecoin issuers, which also bought more Bitcoin for its reserves this week. However, it is a different tale for Grayscale, which has sold over 10,000 BTC due to outflows from its converted GBTC ETF.
According to data compiled by CC15Capital, the nine newborn Bitcoin ETF issuers added 10,667 Bitcoins to their holdings on January 17, the fifth day of ETF trading. BlackRock IBIT alone bought at 8,700 BTC worth over $350 million. Since the ETF's approval, the nine issuers have bought almost 68,500 BTC worth around $2.8 billion.
The acquisition highlights the rate of inflows into the new ETFs, which has been very impressive. Two of them - BlackRock IBIT and Fidelity FBTC - have now reached $1 billion in assets under management. At the end of day five, total net flows for spot Bitcoin ETFs now stand at $1.2 billion. This could have been higher if not for the massive outflows from GBTC.
Bloomberg senior ETF analyst Eric Balchunas noted that GBTC outflows represent the biggest challenge for the new ETFs so far. Since trading started, GBTC's outflow has reached $2.2 billion compared to the $3.3 billion inflow into the nine newborns.
"WHEN WILL THE BLEEDING STOP? I don't know, but this is some serious daily outflows for The Nine to battle. They've done a great job so far, but damn it, it's a lot to ask," he said.
Bitcoin In Danger of Dropping to $40k
Meanwhile, the general performance of the new spot Bitcoin ETFs is not reflected in the flagship asset. Bitcoin is down 10% in the last seven days and trades at $41,000. If the trend continues, BTC could drop to $40k.
The poor performance is mostly a result of Grayscale outflows on the net flows for spot Bitcoin ETFs. Since its conversion, almost 38,000 BTC has been withdrawn from GBTC, and there will likely be more withdrawals. The major reason for the withdrawal is the 1.5% fee that Grayscale is charging for its ETF, far above the average fee among the new issuers.
Tether Buys BTC
Despite BTC's recent performance, Tether bought 8,888 Bitcoin worth $380 million at the end of the fourth quarter. The stablecoin issuer committed in May 2023 to spend up to 15% of its profits on BTC.
It has followed through as an address associated with the company now holds 66,465 BTC. According to Bitinfocharts, this address is the 10th largest Bitcoin holder. Tether's 2023 Q3 attestation report also stated that it holds $1.7 billion BTC.
