The 12 Bitcoin exchange-traded products (ETFs) in the United States experienced a significant reversal last week, with $1.2 billion in net outflows. This marked their second-largest weekly setback since their launch in January 2024, according to data from SoSoValue. The outflows came after a two-week period of inflows totaling over $5 billion, signaling a shift in institutional sentiment.
Investors pulled capital from major issuers like BlackRock’s IBIT, Fidelity’s FBTC, ARK Invest’s ARKB, Bitwise’s BITB, and Grayscale’s funds. The pullback coincided with a volatile week for Bitcoin, which briefly dropped below $104,000, its lowest level since June. Market experts attributed the drawdown to macroeconomic factors related to US-China trade tensions, impacting risk assets like Bitcoin.
Despite the setback in the US, a different narrative unfolded in London as Bitcoin exchange-traded notes (ETNs) began trading on the London Stock Exchange after a three-year retail ban on crypto investment products. BlackRock’s iShares Bitcoin ETP led the debut, signaling a shift in retail access to Bitcoin in the UK.
As institutional focus on Bitcoin intensifies and adoption grows, Galaxy Research predicts that crypto investment products could attract up to $600 billion in new inflows. The US advisory market, with $30 trillion in client assets managed by 300,000 financial advisors, presents a significant opportunity for Bitcoin ETFs. Recent endorsements of digital assets by major financial institutions like Morgan Stanley and Vanguard further support this trend.
Galaxy Research anticipates that the full integration of digital assets into large advisory platforms could transform Bitcoin into a mainstream, investable asset with a potential AUM of $500 billion within a few years. This structural shift could bring more mature liquidity to Bitcoin, aligning it closer to traditional asset classes like equities, bonds, and gold.
