Substantial Inflows into Bitcoin ETFs Could Threaten Gold’s Position as Store-of-Value
According to ETC Group Head of Research André Dragosch, there is a growing divergence between global fund flows into bitcoin and gold. This could indicate that bitcoin is on track to surpass gold as the primary store-of-value. Dragosch noted that a majority of new investments in bitcoin are related to US-based ETFs, which are becoming increasingly important for bitcoin’s overall performance.
Inflows into Bitcoin ETFs Outpace Outflows from Grayscale’s GBTC Fund
Data from ETC Group shows that net flows into global bitcoin ETFs have significantly increased since February. This trend is partly due to a slowdown in outflows from Grayscale’s converted GBTC fund. The Block’s Data Dashboard confirms a deceleration in GBTC outflows since January. Last Thursday, ETF inflows totaled $389.55 million, while gold experienced net negative flows.
Bitcoin as Both Risk-On Investment and Safe-Haven Asset
Ryze Labs analysts support the view that bitcoin has become both a “risk-on” investment and a reliable safe-haven asset. They highlight the significant outflow from gold ETFs ($2.4 billion) compared to the inflow into bitcoin ETFs ($3.89 billion). Ryze Labs analysts believe that bitcoin will outperform gold in various market conditions.
Long-Term Disruption of Gold by Bitcoin
Dragosch expects the trend of bitcoin outperforming gold to continue long-term and ultimately disrupt gold as the prime store-of-value. However, he acknowledges that the current market cap of global gold ETPs is three times larger than that of bitcoin’s ETP and ETF combined market cap.
The price of bitcoin is currently at $52,357, according to The Block’s Price Page. The GM 30 Index, representing the top 30 cryptocurrencies, has slipped 1.72% in the past 24 hours.
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