Bitcoin ETFs Record Inflows of +2.2 Billion Dollars in the Last 4 Days
If you’ve been keeping an eye on the cryptocurrency market, you might have noticed that Bitcoin has been showing incredible strength lately. In fact, it’s been making waves in the market of new US spot ETFs, with capital inflows of $2.2 billion in the last 4 days. This surge has even surpassed those recorded by gold ETFs.
This cryptocurrency rally, which recently crossed the $52,000 threshold, is accompanied by record volumes in BlackRock, Fidelity, ARK, and Bitwise products. At the same time, there has been a decrease in investor interest in gold bars.
Many analysts are predicting an imminent drop in the price of gold in favor of its digital counterpart. The details below shed more light on this fascinating trend.
Record Inflows for Bitcoin ETFs
Two days ago, Bitcoin made a strong landing at the level of 52,000 USD. This surge was driven by extremely positive data recorded by the new spot ETFs in the United States, which surpassed those related to gold during the same time frame.
Since the beginning of the year, capital inflows into exchange traded products based on Bitcoin have been higher than those recorded by traditional gold investment funds. In particular, two of the largest physical yellow metal ETFs – SPDR Gold Shares (GLD) and iShares Gold Trust (IAU) – have shown net outflows of 2.6 billion and 507 million dollars respectively since January 1, 2024.
- The SPDR Gold Shares (GLD) recorded net outflows of 2.6 billion dollars.
- The iShares Gold Trust (IAU) showed net outflows of 507 million dollars.
In total, out of the 14 gold ETFs monitored on ETF.com, 11 have recorded net outflows since the beginning of the year. According to Eric Balchunas, Senior ETF Analyst at Bloomberg Intelligence: “The situation is quite bad right now in the gold ETF category.”
Bitcoin ETF Performance
On the Bitcoin front, since the ETFs were approved by the SEC on January 11th, we have witnessed net positive inflows on all new major Fund Managers (excluding Grayscale). IBIT by BlackRock and FBTC by Fidelity alone have attracted an AUM of almost 10 billion dollars since their launch. If we include the outflows from GBTC – with Grayscale investors selling shares of trust to take profits or move to less expensive products – Bitcoin spot ETFs as a group have recorded approximately 5 billion dollars in net inflows.
- In just over a month since its launch, iShares Bitcoin Trust by BlackRock has reached an AUM of 5 billion dollars.
- Wise Origin Bitcoin Trust by Fidelity closes with an AUM of $4.2 billion.
The Battle Between Bitcoin and Gold
In light of these developments – with inflows into Bitcoin ETFs and outflows from gold ETFs – several finance experts suggest that gold could potentially leave its throne in favor of its cryptographic counterpart. It’s not simply a matter of capital inflows; it’s about how global financial markets are evolving and how assets like gold risk losing their traditional role as a hedge against inflation and as a parking spot for liquidity during times of turbulence and uncertainty.
- In place of physical gold bars, Bitcoin is attracting increasing interest from retail and institutional investors due to its speculative nature and recent expansion in regulated US markets.
- Well-known investor Robert Kiyosaki suggests that gold could experience a potential price collapse below $1200 while gold and silver soar.
Potential for Growth
While gold still represents one of the most capitalized assets globally with a value of about 13.5 trillion dollars, many argue that this bias favors Bitcoin as a safe haven asset to include in portfolios due to its limited potential growth compared to Bitcoin’s youthfulness.
Adam Back, co-founder and CEO of Blockstream suggests that Bitcoin could surpass the decline of gold faster than previously predicted. This narrative emphasizes how traditional markets are rapidly evolving while underlining Bitcoin’s disruptive potential in reshaping the global financial landscape.
Maximalists like Michael Saylor highlight intrinsic characteristics that make digital gold superior to its physical counterpart from several points of view. The advantages become evident when one considers transporting physical gold compared to moving Bitcoin across borders.
With these developments taking place across different sectors including finance and technology, it’s clear that we’re witnessing a significant shift towards digital assets like Bitcoin over traditional safe haven assets such as physical gold.
As always when investing or seeking financial advice consult with professionals before making any decisions!
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