Hunter Horsley, the chief executive of Bitwise, has predicted that wealth management companies will increase their bitcoin exchange-traded funds (ETFs) where holdings are concerned.
The prediction has been made at a time when Bitcoin ETFs are expected to gain even more traction now that Bitcoin has completed its fourth halving.
The demand
In addition, the CEO’s prediction aligns with the broader crypto market belief that the demand for ETFs is on the rise.
Right before the bitcoin halving day, there was a net positive inflow recorded in Bitcoin investments in exchange-traded funds (ETFs) in the United States, after having recorded five straight days of outflows.
While the Grayscale Bitcoin Trust (GBTC) remains the largest Bitcoin ETF in the market, BlackRock’s iShares Bitcoin Trust (IBIT) is catching up to it, as it is now only $2 billion shy.
This means that BlackRock is likely to surpass Grayscale as the largest Bitcoin fund in the world. The latter recorded a value decline over a period of 68 days.
It saw its value reduce to $19.4 billion after shedding almost $16 billion in assets. Meanwhile, IBIT has recorded continuous growth, as its total assets are now valued at $17.3 billion.
The outflows
Grayscale’s spot Bitcoin ETFs have recorded notable capital outflows. In the last five days alone, investors had withdrawn a total of $89.9 million, which resulted in a net outflow of about $1.6 billion since January.
Even though Grayscale had an early lead in the Bitcoin ETF market, the company is now losing its supremacy.
Since the launch of Bitcoin ETF trading, both BlackRock and Fidelity have managed to gain a substantial share of the market.
For instance, net inflows of $37.3 million and $18.7 million had been recorded by Fidelity and BlackRock Bitcoin ETFs in the same week, which provided relief to some of the liquidity issues in the market.
The prediction
According to the Bitwise CEO, multifamily offices and registered investment advisers (RIAs) have adopted Bitcoin ETFs significantly, albeit stealthily.
He noted that prominent financial entities are conducting thorough assessments of the Bitcoin market discreetly.
Data from Farside shows that on April 10th, outflows from GBTC had reached $17.5 million, which was a significant decline from outflows recorded on April 9th of about $154.9 million.
The previous low had been recorded on February 26th when $22.4 million had been withdrawn from the fund.
Since January, the average daily GBTC outflow has reached $257.8 million. GBTC had first been launched in 2015, but it was in January that it was converted into an ETF.
Nine other spot Bitcoin ETFs had been launched on the same day. This was after Grayscale had won a lawsuit against the US SEC.
The Securities and Exchange Commission had been forced to review the conversion bid GBTC had made, which had been rejected.
Recently, Genesis, a bankrupt crypto lending firm, sold about 36 million GBTC shares and used the proceeds to purchase 32,014 BTC tokens.