BlackRock's iShares Becomes Largest Spot Bitcoin ETF

BlackRock’s iShares Bitcoin Trust (IBIT) has surpassed Grayscale Bitcoin Trust (GBTC) as the world’s largest spot Bitcoin ETF.
BlackRock's iShares Becomes Largest Spot Bitcoin ETF

Key Takeaways

  • BlackRock’s iShares Bitcoin Trust (IBIT) surpasses Grayscale Bitcoin Trust (GBTC) as the top spot Bitcoin ETF.
  • Grayscale’s higher 1.5% fee led to significant investor pullout, favoring BlackRock’s 0.25% fee IBIT.
  • Total Bitcoin held by ETFs exceeds 1 million BTC, with the US leading $1.03 billion weekly inflows.

In a notable shift in the market, BlackRock’s iShares Bitcoin Trust (IBIT) has overtaken Grayscale Bitcoin Trust (GBTC) to become the world’s largest spot Bitcoin exchange-traded fund (ETF).

Recent data from SoSoValue shows that IBIT now holds $19.68 billion in Bitcoin (BTC), slightly surpassing GBTC’s $19.65 billion.

This milestone, achieved 96 trading days after the approval of spot Bitcoin ETFs, marks a significant era for financial products based on Bitcoin.

Grayscale’s higher 1.5% fee for its GBTC ETF led to a significant investor exodus, favoring BlackRock’s IBIT with a lower 0.25% fee.

HODL15Capital commented:

Grayscale held 620,000 BTC at the time of the conversion (January 10, 2024), which was more than 3% of circulating supply, but refused to lower the fee (1.5% vs 0.2% for peers), even after investors pulled 330,000+ BTC.

GBTC experienced its largest single-day outflow in 18 trading days, totaling $105 million.

In contrast, the overall Bitcoin ETF sector saw a net inflow of $45.14 million on May 28, 2024, extending an 11-day streak of net inflows across 11 US Bitcoin ETFs.

BlackRock leveraged its income and bond-focused funds to invest in IBIT.

The BlackRock Strategic Income Opportunities Fund (BSIIX) and the Strategic Global Bond Fund (MAWIX) purchased shares worth $3.56 million and $485,000, respectively.

Despite these significant purchases, they represent only a fraction of their respective portfolios.

The total Bitcoin held by ETFs now exceeds 1 million BTC, nearly 5% of the total Bitcoin supply.

The US leads with $1.03 billion in weekly inflows, followed by significant inflows from Germany and Switzerland.

CoinShares data reflects a positive market sentiment with digital asset investment products recording $1.05 billion in inflows over three consecutive weeks, pushing the total value of digital asset ETPs close to $98.5 billion.

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