For the first time since the Bitc0in spot ETFs launched in January, Grayscale’s ETF was not the leader in outflows, losing the spot to ARK/21Shares ETF, which shed over $87 million on April 2.
The two leaders, Fidelity and BlackRock, continue to be popular with investors, marching on with their ludicrous record of 52 days of consecutive inflows.

Since the SEC gave the green light to spot ETFs for Bitcoin in mid-January, Grayscale’s GBTC has had the unwanted distinction of being the market leader in net outflows, bleeding hundreds of millions of dollars daily to sully an otherwise flawless performance by Bitcoin ETFs.

However, on April 2, ARKB, the ETF offered by Cathie Wood’s Ark Invest and Swiss crypto asset manager 21Shares, overtook Grayscale for the first time after losing over $87 million.

Data by Farside shows that on April 2, Bitcoin ETFs brought in $40.3 million in net inflows. BlackRock’s IBIT was the unsurprising leader, raking in $150.5 million, three times more than the next best, Fidelity’s FBTC. VanEck’s HODL recorded $5.6 million in net inflows, with Bitwise and Valkyrie bringing in $4.3 million and $3.7 million, respectively.

Grayscale was, as expected, on the opposite side. It lost $81.9 million for the day. While significant, this was its least net outflow since March 12 and over 70% lower than the previous day, when it lost $302 million. Cumulatively, Grayscale has shed a staggering $15.15 billion since it converted its GBTC Trust into an ETF. It, however, remains the largest BTC holder in the world, ahead of BlackRock and Microstrategy.

The biggest news was that ARKB overtook Grayscale for net outflows. The ETF, which has $2.85 billion in assets under management, shed $87.5 million, a sharp spike from the previous day when it lost $300,000, the first-ever net negative for the ETF.

Bitcoin ETFs Growth Continues

While the outflows with ARKB and Grayscale’s continued bleeding may grab the headlines, it’s important to put everything in context. Bitcoin spot ETFs have remained popular with investors, and despite BTC’s price dip two weeks ago, investor appetite for the products has not taken a beating.

Eric Balchunas, Bloomberg’s ETF analyst, best summed it up, revealing that these products recorded $111 billion in trading volume in March, about triple their volume from the previous month. As the graph below illustrates, Grayscale’s Bitcoin Trust did a small percentage of these figures before the ETFs launched, proving that they have attracted billions of dollars in new investment.

What may be concerning for the crypto industry is BlackRock’s continued dominance in the industry. Initially, Grayscale was dominant, and BlackRock was almost tied with Fidelity regarding trading volume. However, with time, BlackRock has continued to break off from the pack and now accounts for more volume than Fidelity and Grayscale combined.

Great chart from @JSeyff that shows how $IBIT has just taken over the volume market share from $GBTC. While all of the ETFs won in terms of being profitable hits, $IBIT won the volume race and is officially the $GLD of bitcoin. It’s basically a wrap. pic.twitter.com/SGe8gH1heL

— Eric Balchunas (@EricBalchunas) April 2, 2024

Additionally, BlackRock now holds over 256,000 BTC, making it the world’s second-highest Bitcoin owner after Grayscale. And with GBTC bleeding hundreds of millions daily, it may not be long before BlackRock overtakes it. For an industry whose foundation is built on the ethos of decentralization, having the world’s largest asset manager controlling such a substantial share of the tokens could be perceived as going against the narrative.

On the flip side, BlackRock may be crypto’s best ally. As Crypto News Flash reported, the firm is expanding its efforts into other networks, including launching an ETF on Ethereum.

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Filed under: Bitcoin - @ April 3, 2024 6:04 pm