Spot Bitcoin-ETFs were launched in the US in January 2024, marking a watershed moment for the entire cryptocurrency industry. In the ten months since their launch, investors have seen a net inflow of $21.6 billion.

And this figure takes into account the strongest outflow of $20 billion from the GBTC tool from Grayscale, which received too high commissions for use against competitors. Accordingly, investors not only managed to cover this minus, but also to provide a serious inflow of capital.
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For example, over the last 24 hours, net inflows into spot Bitcoin-ETFs totalled $401.2 million.

Capital inflows and outflows from spot Bitcoin-ETFs in the U.S. by day

Well, the result of the week reached an inflow of 1 billion, which is not a bad result in the context of the last few months. Here is the corresponding chart.

Inflows and outflows from spot Bitcoin-ETFs in the US by week

What’s happening with Bitcoin-ETFs

Analysts at Binance noted that most of the $63.3 billion in assets under management in spot Bitcoin-ETFs since their launch in January were not necessarily fresh investments in the cryptocurrency space.

It turns out that a “notable portion” of the buying activity is due to individual investors moving their assets from digital wallets and centralised exchanges into the funds. In this way, they seek to increase the security of their own funds in case any crypto platforms collapse.

Here’s a relevant rejoinder to the study, as cited by Cointelegraph.

Spot ETFs fulfil a dual role. Not only do they attract new investors, but they are also important tools in the hands of existing players. These traders prefer the regulated ETF structure to other options for working with crypto.


Note that the day before, MicroStrategy co-founder Michael Saylor recommended that crypto fans send their own coins to large companies for safekeeping, which is essentially in line with the trend described above. However, decentralisation enthusiasts criticised this approach, and rightly so. Read more about the situation in a separate article.


The lion’s share of the market belongs to individual traders

Despite the apparent dominance of individual investors, Binance analysts also note growing demand from institutional traders, i.e. professional market participants with access to large capital. Investment advisors and hedge funds are the two most interested types of institutionalisers.

Unfortunately, in traditional finance, Bitcoin and Bitcoin-based instruments are still treated with “restraint” even after the emergence of spot exchange-traded funds. For example, earlier the US investment giant Vanguard announced its unwillingness to get involved with such ETFs.

Varieties of investors who mess with spot cryptocurrency ETFs

Vanguard is the second largest ETF issuer in the world and has previously repeatedly refused to launch any crypto-based instruments for clients.

The company’s new CEO Salim Ramji reiterated this strategy on 14 August and stated that the company “will not launch any cryptocurrency ETFs”. According to Binance analysts, this “cautious approach” is in line with how traditional finance typically interacts with crypto.


This is further fuelled by the lies about digital assets that are regularly spread by the traditional finance industry. For example, Federal Reserve Bank of Minneapolis President Neel Kashkari said this week that the volume of transactions in cryptocurrencies is negligible, well, the coins themselves are predominantly used to purchase drugs and other illegal activities.


There are some outspoken Bitcoin fans in the institutional camp, including MicroStrategy, which ranks first in terms of the amount of BTC on its balance sheet among publicly traded companies. And MicroStrategy is unlikely to ever sell even a fraction of its 252,220 BTC, according to analysts at BitMEX Research.

Still, MicroStrategy shares rose more than 10 percent on Thursday to hit a 25-year high of $235.89 at market close. The company’s capitalisation of 43.6 billion comes at a “huge premium” to the total value of its crypto assets, The Block reported.

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Changes in MicroStrategy’s share price

What’s happening is giving MicroStrategy the opportunity to buy more bitcoins and increase its share price by issuing its debt. This leads to increased investor demand, which has a positive effect on the price of both MSTR and BTC. In this way, the company manages to virtually “infinitely print” money.

MicroStrategy founder and executive chairman Michael Saylor has previously stated that he has no intention of selling the company’s bitcoins. However, given MicroStrategy’s significant holdings in this volatile asset and its sizable debt levels, some are wondering if the company may be forced to sell its own coins.


The popularity of spot ETFs among retail investors is a good sign. And while the trend doesn't fit the ideals of decentralisation, as intermediaries are responsible for storing cryptocurrencies here, this option may suit novice users who have yet to get to grips with the blockchain. They can do it later if they wish.


Look for more interesting things in our crypto chat room. We are waiting for you there to properly capitalise on the current bullrun of the coin market and make the most of it.

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