On March 1, seven weeks after its introduction on Jan. 11, BlackRock's iShares Bitcoin ETF IBIT reached $10 billion in AUM, a new ETF landmark. It was the fastest ETF to reach this milestone. IBIT is now the top Bitcoin spot trading vehicle.
This milestone shows investor confidence in digital assets and indicates the bitcoin market's development as a respectable investment sector. It beat SPDR Gold Shares GLD, which took two years to reach $10 billion AUM following its 2004 inception.
This quick increase was boosted by a record-breaking week of trading and inflows among 10 trading spot bitcoin ETFs, with IBIT alone seeing $604 million inflows on Feb. 29, following a $612 million record the day before. More than three-quarters of IBIT's AUM came from investment inflows, with the rest from price appreciation, according to Bloomberg Intelligence. In February, iShares Bitcoin Trust raised $4.5 billion (see 5 ETFs Investors Loved).
IBIT is gaining popularity for several reasons. First, it provides a secure and regulated path to Bitcoin for investors, addressing security, custody, and regulatory concerns that may dissuade direct cryptocurrency participation. Second, the ETF makes Bitcoin accessible to more investors, including those unfamiliar to cryptocurrencies or preferring traditional financial products.
Spot Bitcoin ETFs are a game changer for cryptocurrency investors, and the rise in inflows indicates institutional investment in Bitcoin.
Bitcoin is on an unstoppable rally this year due to increasing demand for spot bitcoin ETFs. Bitcoin reached a record $69,000 on March 5 before falling below $64,000. The cryptocurrency outperformed global stocks and boosted digital-asset market optimism in 2024 at its new high of 63%.
Given its April “halving” occurrence, token and ETF popularity is anticipated to continue rising. Halves, which lower the incentive for mining new blocks, have historically boosted Bitcoin's price. Bitcoin's unique position in the digital currency industry has many positive, with many expecting it to reach $100,000 by year-end.
iShares Bitcoin Trust tracks Bitcoin prices. It lets investors use regular brokerage accounts for Bitcoin. The fund costs investors 25 bps annually. For the first 12 months or $5 billion in assets, the cost is 0.12%. The $6.6 billion Fidelity Wise Origin Bitcoin Fund FBTC trails IBIT.
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