Surge in Fidelity’s Spot Bitcoin ETF Inflows Marks Best Day for US Bitcoin ETFs in Nearly Two Months

• The United States has recently experienced the highest daily net inflow for spot Bitcoin ETFs in nearly two months.
• Despite the robust inflows, the largest ETF by assets under management did not contribute to this surge.
• “Never been more optimistic about the road ahead for Bitcoin and crypto. Glad to be part of this community,” remarked Bitwise CEO Hunter Horsley.

Friday marked a significant rebound for US Bitcoin ETFs as they logged a total net inflow of $263.1 million, showcasing renewed investor confidence.

Spike in Bitcoin ETF Inflows Despite Mixed Performance Among Major Funds

On Friday, US-based spot Bitcoin ETFs recorded an impressive daily total net inflow of $263.1 million, the highest single-day inflow since July 22. However, it’s noteworthy that BlackRock’s IBIT, which is the largest fund by assets under management (AUM), saw no net trading activity. Most of its recent trading days reported minimal or no inflows, highlighting a shift in investor focus.

Fidelity and Ark Leading the Charge

Leading Friday’s inflows was Fidelity’s FBTC, which attracted $102.1 million. Close behind, Ark & 21Shares’ ARKB fund saw inflows reaching $99.3 million, positioning them as significant contributors to the overall inflow. Bitwise’s BITB also made substantial gains with an inflow of $43.1 million. Bitwise CEO Hunter Horsley expressed his optimism, reflecting the sentiment of many in the crypto community. Smaller gains were noted in funds like Grayscale’s GBTC and Franklin’s EZBC, among others.

Comparative Performance and Investor Sentiment

Interestingly, despite the lack of inflows into BlackRock’s IBIT, other prominent funds held their ground, indicating varied investor strategies. Grayscale’s GBTC posted a modest gain of $6.7 million, while Franklin’s EZBC and VanEck’s HODL logged $5.2 million and $5.1 million, respectively. Valkyrie’s BRRR reported minor inflows, underscoring a broad-based positive sentiment among smaller funds.

Market Anticipation and Macro Factors Driving Sentiments

The surge in Bitcoin ETF inflows coincides with Bitcoin’s price holding steady around the $60,000 mark. This comes as traders speculate on an upcoming interest rate cut from the Federal Reserve, scheduled for next Wednesday. According to CME FedWatch, there is an equal probability that the Fed will reduce rates by either 25 or 50 basis points. This anticipated monetary policy shift is fueling optimism among crypto investors.

Ethereum ETFs Show Modest Recovery

While Bitcoin ETFs saw a boom, US-based spot Ether ETFs logged a modest $1.52 million in inflows after two days of net negative outflows. Grayscale’s ETHE experienced an outflow of $7.4 million, which was counterbalanced by $5.21 million in inflows to Bitwise’s ETHW and $3.7 million to BlackRock’s ETHA. As of now, Ethereum’s price is up 2.3% over the past 24 hours, reflecting cautious but positive investor sentiment.

Conclusion

This recent uptick in Bitcoin ETF inflows underscores a resurgence in investor confidence, particularly among funds managed by Fidelity and Ark. While BlackRock’s lack of activity may raise questions, the broad-based inflows among smaller and emerging funds illustrate a diversified and sustained interest in the cryptocurrency market. A potential interest rate cut by the Federal Reserve could further influence investor strategies in the coming weeks, making it crucial to stay attuned to both market and policy developments.