- BlackRock’s head of digital assets, Robert Mitchnick, highlighted that Bitcoin ETFs are currently drawing more investor demand than Ethereum funds at the Bitcoin 2024 conference.
- Despite Ethereum ETFs being new market entrants, they have not yet seen the same level of capital allocation as Bitcoin ETFs.
BlackRock’s head of digital assets, Robert Mitchnick, recently highlighted that Bitcoin ETFs currently draw more investor demand than Ethereum funds. His remarks came at the Bitcoin 2024 conference in Nashville, expected to attract 20,000 crypto enthusiasts.
Exchange-traded funds now offer exposure to the largest cryptocurrencies, Bitcoin and Ethereum. While spot ETH ETFs are the new market entrants, spot BTC ETFs have been trading since January, amassing over $60 billion in assets under management, according to SoSoValue. Mitchnick noted that it’s still early to determine if investors will reallocate capital from Bitcoin funds into Ethereum ETFs.
Spot Ether ETFs achieved 79% of the day-one total flows recorded by spot Bitcoin products. However, data including Grayscale outflows slashed that number to 16% as investors exited the firm’s ETHE vehicle. This led to a price slump for Ethereum, which was down up to 7% on July 25.
Similar investor behavior occurred in January when spot BTC ETFs launched, with investors also pivoting away from Grayscale’s converted GBTC at the time. If this pattern continues, markets may experience days or weeks of Grayscale outflows, potentially leading to a positive flip in total flows if spot ETH ETFs capture Wall Street demand.
BTC vs ETH ETFs Day 1 Comparison:
— Juan Leon (@singularity7x) July 24, 2024
Total ETH flows ($108M) were 16% of BTC flows ($655M), but 79% if you exclude the outflows from ETHE ($484M)/GBTC ($95M) conversions.
ETHE outflows likely larger because it was already trading at NAV on conversion, while GBTC was still at… pic.twitter.com/7E4iGKA7Vr
Despite these trends, many in the crypto industry believe that ETFs for Bitcoin and Ethereum will incentivize the launch of more U.S. crypto funds soon. Issuers like VanEck have already filed for a Solana Trust, designed similarly to existing spot ETFs.
In a discussion with Bloomberg’s James Seyffart, Mitchnick revealed that BlackRock does not currently see demand for crypto ETFs beyond Bitcoin and Ethereum.
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