Bitcoin ETFs outperform Ether ETFs as BlackRock’s IBIT leads peers

  • Bitcoin ETFs have attracted $5B net inflows while Ether ETFs have seen $500M net outflows.
  • BlackRock’s IBIT leads with over $224M in a single day, currently holding over 350,000 BTC.
  • Ether ETFs are struggling due to liquidity issues and Grayscale’s $2.5B outflows.

Recent trends in the cryptocurrency exchange-traded funds (ETF) market have highlighted a significant divergence in the performance of Bitcoin and Ether ETFs.

Comparing Bitcoin ETF Flow data to Ethereum ETF Flow data on Farside Investors, Ether spot ETFs have underwhelmed compared to their Bitcoin counterparts. Since their launch, Ether ETFs have experienced net outflows of approximately $500 million, a stark contrast to the $5 billion net inflows recorded by BTC ETFs during a similar period following their debut.

Several factors contribute to this disparity. To start with, Bitcoin’s “first mover advantage,” higher liquidity, and lack of staking opportunities in Ether ETFs have made Bitcoin more appealing to institutional investors.

Additionally, unexpected outflows from Grayscale’s Ethereum Trust (ETHE), amounting to $2.5 billion, far exceeding the bank’s initial $1 billion estimate, have further dampened Ether ETF performance. To counter these outflows, Grayscale introduced a mini-Ether ETF, but it has only managed to attract $200 million in inflows.

In contrast, BTC ETFs have shown resilience and robust performance with US-based BTC ETFs recording an impressive eight-day winning streak, with net inflows totalling $202 million led by BlackRock’s iShares Bitcoin Trust (IBIT).

On August 26 alone, IBIT attracted over $224 million in net inflows bringing its total Bitcoin holdings to over 350,000 BTC, solidifying its dominance in the market.

Bitcoin ETF flows outperform Ether ETFs as BlackRock's IBIT leads peers
US Bitcoin ETF AUM, August January 18 – August 30, 2024|Source: Bitcoin ETF Fund Flows

Competing funds such as those managed by Franklin Templeton and WisdomTree also saw positive inflows, while others, including Fidelity, Bitwise, and VanEck, reported negative flows. Notably, Grayscale’s Bitcoin Trust (GBTC) saw a decline in redemptions over the past two weeks, indicating stabilization in the market.

As investor confidence in Bitcoin ETFs grows, asset managers are increasingly exploring combined ETFs that offer exposure to both Bitcoin and Ethereum, reflecting the evolving dynamics of the cryptocurrency investment landscape.

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Metaplanet partners with SBI VC Trade to enhance Bitcoin strategy

  • Japanese investment firm Metaplanet has announced a partnership with SBI VC Trade, a subsidiary of financial services behemoth SBI Group.
  • Partnership will help boost Metaplanet’s Bitcoin strategy, including compliance.
  • Metaplanet has acquired 360 Bitcoin (BTC) as it targets becoming ‘Asia’s MicroStrategy’

In an announcement on Sept. 2, Metaplanet said its collaboration with SBI VC Trade is part of the company’s quest to enhance its Bitcoin strategy with support from Japan-based firms. This includes trading, custody and management of Metaplanet’s Bitcoins.

Metaplanet is a publicly-traded company listed on the Tokyo Stock Exchange and the partnership with the SBI crypto arm offers a route to further compliance.

“A key element of this partnership is access to a compliant corporate custody service that prioritizes tax efficiency and offers the potential to utilize Bitcoin as collateral for financing,” Metaplanet said in a statement.

The alliance with SBI VC Trade aligns with Metaplanet’s vision of becoming a leading modern financial services firm. It also adds flexibility to Metaplanet’s corporate strategy, bolstering its efforts to accumulate more BTC via equity and debt financing.

Metaplanet will update its stakeholders of any financial o material impact that arises from the partnership, part of the statement read.

BTC as a corporate strategy

The partnership with SBI VC Trade comes amid Metaplanet’s increasing bet on Bitcoin as part of its corporate strategy. In April 2024, the company disclosed its addition of BTC as a core treasury asset and committed an initial 1 billion Japanese yen to buying Bitcoin.

Over the next months, the strategic pivot has seen the industry dub Metaplanet as “Asia’s MicroStrategy” in a nod to its target to mirror the US-listed MicroStrategy’s embrace of the digital asset.

Currently, the Michael Saylor-led company has acquired a total of 226,500 BTC. This accounts for just over 1% of the total supply of Bitcoin and makes MicroStrategy the largest holder of BTC among publicly-traded companies.

On the other hand, Metaplanet holds a total of 360 BTC, having increased its holdings with a series of purchases over the past two months.

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