CryptoQuant founder Ki Young Ju has revealed that institutional investors account for just 20% of all spot Bitcoin exchange-traded funds (ETFs). Based on the firms’ form 13F filings, it is evident that they hold approximately 193,000 BTC of the total 961,645 BTC held by all spot Bitcoin ETFs as of October 18.
The data highlights that Ark Invest ARKB boasts the highest percentage of institutional holders at 32.79%, followed by WisdomTree BTCW at 24.55%. On the other hand, the two largest ETFs in terms of net flow, BlackRock IBIT and Fidelity FBTC, have 18.38% and 24.14% of their shares held by institutional investors, respectively.
A recent Permissionless Debate with macro investment researcher Jim Bianco and Bloomberg ETF analyst James Seyffart shed light on the inflows into Bitcoin ETFs. Jim Bianco emphasized that retail investors are driving the majority of these inflows, suggesting that on-chain holders are largely responsible for the growth in Bitcoin ETFs. He also pointed out that while institutional interest is increasing, some pension funds, like the State of Wisconsin fund, may not be able to invest in Bitcoin due to various constraints.
Despite the relatively low institutional participation in Bitcoin ETFs, Seyffart believes that these ETFs have been highly successful. He pointed out that financial advisors have contributed over $2 billion to the inflows, with BlackRock IBIT alone receiving $1.5 billion. Seyffart emphasized that the current institutional interest, though modest, is a positive sign for Bitcoin ETFs’ overall growth.
In particular, BlackRock IBIT has emerged as one of the top-performing ETFs in 2024, with impressive net flows exceeding $22 billion year-to-date. This success positions IBIT among the top three ETFs overall, despite being in existence for only 10 months.
Looking ahead, as Bitcoin ETFs continue to gain traction, asset managers are preparing for potential approval of ETFs for other cryptocurrencies by the Securities Exchange Commission. Notably, pending applications for Solana, Litecoin, and Ripple XRP ETFs suggest a growing interest in expanding the ETF landscape beyond Bitcoin. However, industry experts speculate that regulatory outcomes under Kamala Harris’s leadership may impact the approval prospects for future crypto ETFs.
