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Bitcoin ETF Investment Is Increasingly Expanded By Hedge Funds

Key Points:

Hedge funds, pensions, and banks are significantly expanding their Bitcoin ETF investments.
Since their introduction in January, spot Bitcoin ETFs have attracted $17 billion in net inflows.

According to Bloomberg, institutional investors such as hedge funds, pension funds, and banks have, at a runaway pace, increased their Bitcoin ETF investments.

Hedge Funds Ramp Up Bitcoin ETF Investments

That suggests growing acceptance of Bitcoin by traditional investing organizations, an on-rush energized by regulatory developments early this year. Funds such as Millennium Management have been top buyers. As of now, the firm has held stakes in at least five Bitcoin ETFs.

After paring its stakes from the previous quarter, Millennium retains the top holder position, especially in BlackRock’s iShares Bitcoin Trust—IBIT. It is followed by Capula Investment Management, Schonfeld Strategic Advisors, and Steven Cohen’s Point72 Asset Management.

According to new data, 701 funds reported Bitcoin ETF investments following the recent filing deadline with the U.S. Securities and Exchange Commission, bringing the total to nearly 1,950.

Spot Crypto ETFs Draw Record in Flows

The introduction of spot Bitcoin ETFs in January saw more inflows than expected, with net inflows reaching as much as $17 billion this year. That made BlackRock’s IBIT the largest of them all, swelling to a $20 billion fund. These ETFs made it easier for everyday investors to trade Bitcoin.

Moreover, spot Ether ETFs have been approved since July and have seen $1.9 billion in inflows (net of $2.3 billion in outflows from the Grayscale Ethereum Trust (ETHE) this past month following its conversion to an ETF).

It is worth mentioning that quarterly 13F filings themselves, which are snapshots of institutional holdings, do not detail the reasoning behind the same investment. Motivations could have ranged from speculation on the volatility of Bitcoin’s price to strategic trades involving futures markets.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.